UK equities pushed higher on Tuesday after reports indicated the United States, Iran and Oman were nearing an interim agreement to reopen the Strait of Hormuz.
The development eased investor concerns over disruption to global energy supplies and reduced fears of a broader regional conflict spreading through the Middle East.
By 03:14 ET, the FTSE 100 had climbed 0.41%, with Germany’s DAX gaining 0.49% and France’s CAC 40 adding 0.12% on the session.
Sterling also strengthened during the session, rising 0.08% against the US dollar to trade at 1.3460.
Axios, citing a US official and a regional source, reported that Iran’s leadership had completed its internal approval process, bringing Washington, Tehran and Muscat closer to announcing a 60-day interim agreement.
US President Donald Trump told Fox News that the strait would reopen “very soon,” adding that Iran would be “hit really hard” if it failed to honour the arrangement.
The proposed framework would route inbound Gulf shipping through a northern corridor in Iranian waters and outbound traffic through a southern route in Omani waters, according to Axios.
No transit fees would apply during the temporary arrangement, while naval mines in the central shipping lane would be cleared within 30 days, with Qatar, Pakistan and Saudi Arabia also involved in mediation.
US Central Command confirmed the southern shipping lane through the Strait of Hormuz “remains free and open,” noting that US forces have escorted more than 1,000 vessels through the route over the past three months despite “unwarranted Iranian aggression.”
In commodity markets, Brent crude rose 0.77% to $79.97 a barrel, while US West Texas Intermediate crude edged 0.07% higher to $75.83 per barrel.
Gold futures climbed 1.8% to $4,226.51 an ounce, while spot gold gained 2.2% to $4,166.96, reflecting continued demand for safe-haven assets amid ongoing geopolitical uncertainty.
Hiscox (LSE:HSX) raised its retail growth guidance after reporting a 10.1% rise in first-half insurance premiums, signalling confidence in its ongoing underwriting performance.
Beazley (LSE:BEZ) reported that first-half profit more than halved as elevated claims and softer market conditions weighed on the insurer’s earnings during the period.
Glencore (LSE:GLEN) posted a strong increase in first-half earnings supported by its trading division and confirmed plans to pursue an Australian stock market listing.
Next (LSE:NXT) upgraded its full-year profit forecast after delivering stronger-than-expected sales growth during the latest quarter, adding to positive momentum across UK retail.