UK stocks set for weekly losses amid dimming prospects of swift US-Iran truce

• Rising crude oil prices on fears of renewed Middle East military escalation dragged the travel and leisure sector down 1.4%, with Wizz Air falling 4.9%
• Heavyweight banks Barclays and HSBC each fell more than 1%, while Mondi plunged 8.2% after citing rising costs due to the Iran war
• British retail sales rose 0.7% in March, though major retailers warned that persistent Middle East tensions are likely to cloud their earnings outlook

UK Stocks Decline on Geopolitical Tensions and Central Bank Warning

UK equity markets fell on Friday, April 24, 2025, heading toward their first weekly decline in five weeks as prospects of a swift US-Iran peace deal dimmed. The FTSE 100 dropped 0.6% to 10,391.16 points by 1005 GMT, while the mid-cap FTSE 250 fell 1.1%. Weekly losses are set to erase all gains accumulated since the US-Iran ceasefire announcement earlier in the month.

Key Market Drivers:

Rising crude oil prices on fears of renewed Middle East military escalation pressured risk assets, with no progress reported in reopening negotiations. The Bank of England added to negative sentiment by warning that global stock markets are expected to decline amid current conditions.

Sector Performance:

• Travel and leisure led declines, falling 1.4%, with Wizz Air down 4.9%
• Major banks Barclays and HSBC dropped over 1%
• Mondi plummeted 8.2%, the FTSE 100's worst performer, after citing rising costs due to the Iran conflict
• Personal care, drug, and grocery stocks gained 0.5%, along with energy and utilities, among few bright spots

Notable Movers:

Technology and services provider (name unspecified) surged 9.9% after forecasting annual profits would exceed expectations.

Economic Data:

Sterling gained 0.1% following data showing UK retail sales rose 0.7% in March, though major retailers warned that persistent Middle East tensions could negatively impact earnings outlooks.

The market selloff reflects investor concerns over geopolitical instability, elevated oil prices, and cautious guidance from both central banks and corporate management regarding the economic impact of ongoing regional conflicts.