Fed's Steady Rate Decision and Iran Tension Push FTSE 100 Lower

The Fed's decision to hold rates steady and Trump's fresh threats against Iran are dragging the London market into the red.

A Downward Breeze Hits the FTSE 100

■Futures indicate an opening dip of 0.6%.

■The index peaked at 10,951 points, retreating to 10,864 later in the day.

■Deutsche Bank analysts attribute the move to the Fed's on‑hold decision.

Fed Stance Meets Inflation Anxiety

■Kevin Warsh's appointment fuels expectations of rate cuts.

■Rising inflation fears are compounded by US‑Israel‑Iran clashes that have spiked oil prices.

■Bond yields climbed, reflecting doubts about the Fed's ability to rein in inflation.

Middle‑East Tension Fuels Energy Volatility

■New attacks on Iran are stirring turbulence in energy markets.

■Oil prices continue their upward trajectory, feeding global inflation pressure.

■The S&P 500 closed 1.52% lower, while the semiconductor sector slumped 5.33%.

Corporate Earnings Provide a Buffer

■Positive results from BAE Systems, Lloyds Banking Group, London Stock Exchange Group, and Shell help temper the decline.

■Rolls‑Royce lifted its profit guidance to £4.7‑4.9 bn operating profit and £3.8‑4.0 bn free cash flow for the full year.

Data Calendar and Market Pulse

■Germany and Eurozone Q2 GDP, inflation, and unemployment figures are due today.

■The Bank of England will keep its policy rate unchanged.

■US core PCE and GDP releases will shape global liquidity flows.

Bora Yalın – The Fed’s steady‑rate stance triggers a risk‑off wave, while geopolitical strain in the Middle East pushes energy prices higher. This twin pressure underpins the FTSE 100’s short‑term losses, yet strong earnings from firms like Rolls‑Royce provide a modest counterbalance. Tightening liquidity and rising inflation expectations are likely to keep European equities under downward pressure over the next fortnight.