FTSE 100 Slides as Middle East Conflict Grows; Rotork Soars on ABB Deal
By Tharuniyaa Lakshmi
Market Overview and Key Drivers
July 16 (Reuters) - London's FTSE 100 edged lower on Thursday as escalating tensions between the U.S. and Iran dampened risk appetite, while weakness in technology stocks added to the pressure on the index.
FTSE 100 and FTSE 250 Performance
The blue-chip FTSE 100 index fell 0.2% to 10,492.99 points by 1038 GMT.
Geopolitical Tensions Impact
• Iran said that the Strait of Hormuz was an inviolable "red line", warning that if U.S. President Donald Trump carried out his threat to attack Iran's infrastructure, it would strike all infrastructure across the Gulf region.
Sector Movements
Technology Stocks Lead Losses
• Technology stocks led losses, with data and technology firm Experian falling 2.3% after reporting in-line first-quarter results and maintaining its annual outlook, while peer Relx was down 1%.
Rotork Surges on ABB Takeover
• While the FTSE 100 remained under pressure, the midcap FTSE 250 rose 0.3%, helped by a 66.8% jump in Rotork after Swiss engineering group ABB announced a $5.5 billion takeover of the British automation company.
Economic Backdrop
• Meanwhile, Britain's economy eked out minimal growth in May as the services industry expanded but other sectors shrank, suggesting fragile confidence among businesses against the backdrop of the Iran war and a change of prime minister at home.
Analyst Commentary
• "The UK might have delivered the fastest growth in the G7 at the start of the year, but it's a low bar. And the UK's high levels of debt make it particularly vulnerable to further inflation shocks which may result from continued conflict in the Middle East," said Danni Hewson, head of financial analysis at AJ Bell.
Other Notable Stock Moves
Ocado Drops to 13-Year Low
• Among other stocks, Ocado tumbled 18.8% to a 13-year low after the British online grocery and technology group failed to show tangible progress in talks to secure new U.S. partners to boost its business to effectively compete with rapid delivery firms.
Frasers Group Declines
• Frasers Group fell 5.4% after the British retailer declined to provide fiscal 2027 outlook.
(Reporting by Tharuniyaa Lakshmi in Bengaluru; Editing by Leroy Leo)
