UK GDP Growth Offsets Strait of Hormuz Tensions
FTSE 100 flat as July GDP beats forecasts.
The FTSE 100 index ended little changed on Friday. The benchmark was down 0.03% at 07:25 GMT. This flat performance followed stronger-than-expected UK economic data. Traders balanced this positive signal against geopolitical risks. Concerns over the Strait of Hormuz remained a key focus.
UK gross domestic product increased 0.4% in July. This figure exceeded market expectations. The Office for National Statistics reported the data. The economy expanded 1.6% from a year earlier. This is the fastest annual rate since February 2025. Services sector strength drove the growth. Production and construction sectors saw declines.
Geopolitical Tensions Affect Shipping Routes
Iran’s Revolutionary Guard Corps struck a US unmanned vessel. The incident occurred in the Strait of Hormuz. The group claimed the vessel had an aggressive mission. This event followed an IAEA resolution. The agency accused Iran of noncompliance with nuclear commitments. Iran’s UN envoy called the accusations political.
Ship tracking data showed a drop in transit numbers. Seven vessels passed through the strait on Thursday. This is lower than the 11 vessels on Wednesday. The 10-day average stands at 15 vessels. Analysts at ING noted a repricing of conflict duration. They cited risks to Saudi energy infrastructure. Houthi forces target Saudi Arabia near the Red Sea.
Commodity Prices React to Supply Risks
Brent crude declined 2.12% to $105.35 per barrel. WTI crude fell 1.76% to $100.69. Gold futures dropped 0.38% to $4,390.25. Spot gold rose 0.76% to $4,349.24. Sterling strengthened against the US dollar. The currency was 0.09% higher at $1.3524. German DAX gained 0.28% and French CAC 40 rose 0.55%.
Corporate Updates Reflect Market Caution
Berkeley Group cited buyer caution and political uncertainty. These factors are affecting housing demand. The housebuilder maintains its target of £1.4 billion pre-tax profit. It calls for changes to stamp duty rules. Trainline reported first-half net ticket sales of £3.3 billion. Underlying revenue reached £233 million. The company reaffirmed its FY2027 guidance. It announced a new £100 million share buyback programme.
GN markets/growth (en-US) provided the data for this report. The market remains cautious despite positive GDP figures. Investors monitor shipping lanes for further disruption. The balance between economic strength and geopolitical risk persists.
