Britain’s FTSE 100 closed the trading week 1.63% higher, driven by renewed investor optimism surrounding a potential peace agreement between Washington and Tehran.
Bloomberg News reported that the United States and Iran could sign a deal to reopen the Strait of Hormuz as early as next week, on the sidelines of the Group of Seven summit in Switzerland.
Senior officials cited by Bloomberg indicated that the terms of the memorandum of understanding remain subject to approval by Iran’s Supreme Leader Mojtaba Khamenei, according to an unnamed European official.
News of the potential agreement pushed oil prices down more than 2% on Friday, reflecting expectations that a reopened Strait of Hormuz would ease supply disruptions in global energy markets.
BP (BP.L) and Shell (SHEL.L) were among the hardest hit on the blue-chip index, falling 1.98% and 1.69% respectively, making them the two biggest losers of the session.
In corporate news, Flutter Entertainment (FLTR.L) announced plans to delist its ordinary shares from the London Stock Exchange on August 3, while maintaining its New York listing.
The online sports betting and gaming company closed down 3.33% in London on Friday following the announcement of its departure from the domestic market.
On the economic front, Britain’s monthly gross domestic product fell 0.1% in April 2026, in line with analyst expectations, reversing a 0.3% rise recorded the previous month.
The Office for National Statistics confirmed the contraction, which marks the first decline in economic output since August 2025, driven by a fall in services output while construction provided some offset and production stagnated.
Yael Selfin, vice chair and chief economist at KPMG in the UK, struck a cautious note, warning that the April reading signals a broader slowdown ahead for the British economy.
“While UK GDP grew by 0.7% in the three months to April, the contraction in April is more indicative of growth prospects for the economy going forward. We expect UK GDP growth to slow in the second quarter,” Selfin said.
The coming week is set to deliver a heavy schedule of UK economic data, including inflation figures, labour market statistics, the Bank of England’s interest rate decision, retail sales, and public sector net borrowing numbers.