Oil prices retreated and stock markets rallied on Monday after Tehran announced the end of its military operations against Israel. Brent crude, which had surged to $98 a barrel earlier in the day, fell back to trade around $94.58, up just 1.75%. The pan-European Stoxx 600 index turned positive, and London's FTSE 100 closed 5 points higher at 10,373, a gain of 0.05%.
The reversal came after Iran's military joint command said it was halting offensive operations, following exchanges of fire between Israel and Iran. The move eased fears of a wider conflict, prompting investors to buy shares after Friday's sell-off. Mike Bell, head of market strategy at RBC BlueBay, noted that investors have been conditioned to buy the dip over the past 15 years. On Wall Street, the S&P 500 rose 0.8%, lifting hopes that Friday's decline was not the start of a broader downturn.
However, not all sectors shared the optimism. UK housebuilders' shares fell on concerns that the Middle East conflict would keep borrowing costs elevated. South Korea's KOSPI index slumped 8%, underscoring fragility in tech valuations. Meanwhile, US households grew more worried about their finances, with a New York Fed survey showing 13.3% of Americans believe their situation is much worse than a year ago, the highest since July 2022.
In other news, Britain's Financial Conduct Authority (FCA) announced civil proceedings against fund manager Neil Woodford, accusing him of providing regulated investment advice and making financial promotions without authorisation through his platform w4pz.com. The FCA is seeking an injunction to stop the activities, which it says breach the Financial Services and Markets Act 2000. Woodford was previously banned from senior roles and fined £5.89m in 2025 over the collapse of his equity fund.
