Middle East tensions dominate trade

The tensions in the Gulf have moved up one level as the US reportedly nearly ordered an airstrike against Iran in response to several of its drones being shot down.

The tensions in the Gulf have moved up one level as the US reportedly nearly ordered an airstrike against Iran in response to several of its drones being shot down. The markets this morning are readjusting to the new reality with gold slightly lower after it hit $1,400 for the first time in six years, oil gaining half a percentage point and defence contractor BAE Systems rallying 1.45%.

The overall FTSE is higher on a mixture of risers, mainly oil, travel and supermarket chains while pharmaceuticals and luxury brands are adding weight. British Airways' parent International Consolidated Airlines is trading 0.11% lower after BA pilots called for a strike over the latest wage discussions.

In amidst the building Middle East tensions train ticketing company Trainline floated at 350 pence a share, the top end of its range, and gained another 23% in early trade. At £1.68 billion this is the second largest IPO in London this year.

Euro benefits from June growth in Eurozone services

The euro has firmed against the dollar and the pound this morning helped by Purchasing Managers’ Index data showing that the Eurozone’s service sector has slightly expanded in May. Manufacturing still remains Europe’s weak link, shrinking even further than in the previous months, but the growth in the services sector seems to be just about keeping Europe’s economic pulse alive.

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