Market Breakdown: Oil Swings Lift London to a Record, Week of 27 July 2026

The single biggest force acting on London's market in the first three sessions of this week was the oil price, and it pulled hard in both directions. Brent crude had topped $100 a barrel the previous week as the conflict between the United States and Iran disrupted shipping through the Strait of Hormuz and spilled into the Red Sea. After Washington abruptly suspended its bombing campaign over the weekend, Brent settled 8.7% lower at $88.36 on Monday, its weakest since 17 July, with US West Texas Intermediate down 7.5% at $82.61.

The calm did not last. By Wednesday the pause had broken down: Iran's Revolutionary Guard fired ballistic missiles at a US base in Jordan, and the United States launched its first strikes since suspending the campaign, hitting Iran-backed groups in Iraq alongside Saudi Arabia. Brent settled 7.9% higher at $90.74, with WTI up 6.6% at $84.46.

For the FTSE 100, both halves of that story were helpful. The index closed higher in all three sessions, finishing Wednesday at 10,908.41 against 10,736.23 at the previous Friday's close — a gain of about 1.6%, and a record closing high. It did so on the same afternoon that Wall Street suffered its worst day since April 2025.

UK equities

London's benchmark started slowly and accelerated. The FTSE 100 added around 45 points on Monday to close at 10,781.75, helped by the slide in crude and the hope of de-escalation in the Middle East. Tuesday was the strongest session of the three: the index rose 89.27 points, or 0.83%, to 10,871.02, opening at 10,781.87 and reaching an intraday high of 10,884.32. Wednesday added a further 37.39 points, or 0.34%, to 10,908.41, with oil and mining shares doing the heavy lifting as crude rebounded.

The mid-cap index had a flatter week. The FTSE 250 gained on both Monday and Tuesday, closing Tuesday up 106.68 points, or 0.5%, at 24,004.78, before edging down 0.03% on Wednesday to 23,996.81. That leaves it higher over the three sessions, but well behind the blue-chip index — a reminder that the FTSE 100's advance was driven by globally exposed commodity and consumer names rather than by anything domestic.

Sector leadership was unusually clear. Energy and mining led on Wednesday, with Shell up 1.3% and BP up 1.5% as crude rebounded, while Glencore climbed 4% and Rio Tinto rose 2.3% on results day. Tuesday's gain, by contrast, was an earnings story: well-received figures from Unilever, Croda and GSK carried the index even as semiconductor shares were being sold heavily across Asia.

That divergence is the week's structural point. London's index is weighted towards energy, banks, miners and consumer staples, and carries very little exposure to the megacap technology and memory-chip names at the centre of the global sell-off. When the AI trade came under pressure, the FTSE 100 had comparatively little to lose from it and a great deal to gain from firmer crude.

The week's biggest movers

Unilever was the standout. Shares rose 371p, or 8.0%, to 4,998p on Tuesday after first-half results beat expectations and the company raised full-year guidance. Second-quarter underlying sales growth of 5.8% comfortably exceeded the 4.3% consensus, and was driven almost entirely by volume, which rose 5.5% — described by chief executive Fernando Fernandez as the company's best volume quarter in over a decade.

Croda International matched it almost point for point, climbing 235p to 3,160p on half-year results showing 5% organic sales growth to £880.5m, adjusted operating profit up 7% to £155.8m and earnings per share up 9% to 78.6p. Full-year guidance was left unchanged at 3-6% organic sales growth.

Vodafone was Monday's strongest large-cap performer, adding 4.3% to 119.5p after a first-quarter trading update showed revenue up 9.7% to €10.3bn, organic service revenue up 5.2% to €8.6bn and adjusted cash profit up 6.2% organically to €2.9bn.

GSK rose 4.2% in London on Tuesday to a three-month high after second-quarter turnover of £8.4bn, up 5% at constant currency, and core earnings per share of 50.5p, up 9%. Vaccines sales grew 8% to £2.28bn against expectations nearer £2.1bn.

Rio Tinto gained 2.3% on Wednesday after first-half underlying earnings jumped 43% to $6.9bn, the highest in four years, with underlying EBITDA up 28% to $14.8bn and free cash flow up 75% to $3.8bn. Glencore climbed 4% in the same session as commodity shares broadly outperformed.

Barclays was the week's most striking faller, dropping 25.40p, or close to 5%, to 505p on Tuesday despite a 17% rise in half-year pre-tax profit to £6.1bn, ahead of the £5.94bn analysts had expected. Analysts pointed to an equities trading performance that undershot expectations set by the bumper quarter reported at US rivals. AstraZeneca moved the other way on Monday, up about 1.7% in morning trade.

Company news in focus

Barclays paired its results with £2.3bn of first-half capital distributions, up 61% year on year, including a new £1bn share buyback and a 5.9p interim dividend. The bank lifted its 2026 income target to around £31.5bn and reported a return on tangible equity of 14.8%.

GSK used its results day to announce a new cost-savings programme and a significant acceleration of its late-stage pipeline, committing to more than 20 Phase III trial starts in 2026 against a previous target of 10, covering seven late-stage assets across 18 indications in oncology, respiratory, hepatology and vaccines. It declared a second-quarter dividend of 17p and maintained its expectation of 70p for the full year.

AstraZeneca had mixed news on Monday. Alongside first-half revenue of $30.7bn, up 9%, and core earnings per share up 12% to $5.21, the company disclosed a disappointing outcome in an Ultomiris trial. It also said it had secured 30 regulatory approvals in major markets since its fourth-quarter results, and raised the interim dividend to $1.06 a share.

Rio Tinto declared an interim ordinary dividend of $3.4bn, equal to 211.0 US cents a share and 43% higher than a year earlier, maintaining its 50% payout ratio. Unilever confirmed it had completed €1.5bn of share buybacks during the half and raised its quarterly dividend by 3.0% to €0.4664 a share.

On the broker side, analysts at Berenberg reiterated their buy rating on Wheaton Precious Metals on Tuesday while trimming their target price from 11,900p to 11,700p, arguing that the streaming group remains distinct from its peer group.

Earnings in focus

It was one of the densest reporting stretches of the UK calendar, and the reactions were sharply differentiated.

Monday belonged to AstraZeneca and Vodafone. AstraZeneca's first-half growth was led by double-digit gains in oncology and rare disease, enough to offset the loss of US exclusivity on the diabetes drug Farxiga and pressure from China's volume-based procurement programme; full-year guidance for mid-to-high single-digit revenue growth was reaffirmed. Vodafone raised its full-year outlook, now expecting adjusted cash profit of €13.0-13.3bn and free cash flow of €2.6-2.9bn, with performance at the upper end of both ranges, helped by the addition of Three UK revenue and the consolidation of Safaricom.

Tuesday brought Unilever, Barclays, GSK and Croda within a few hours of each other. Unilever's underlying operating margin edged up 10 basis points to 20.3% and underlying earnings per share rose 2.4% to €1.61, with free cash flow up 42.9% to €1.5bn. Barclays grew group income 11% to £16.5bn, with the investment bank generating £4bn of second-quarter income against the £3.7bn expected — a beat that nonetheless failed to satisfy the market.

Wednesday's UK highlight was Rio Tinto, where copper equivalent production rose 3%. After the US close the same day, Microsoft reported fourth-quarter fiscal 2026 revenue of $90.0bn, up 18%, and adjusted earnings per share of $4.74 against the $4.24 analysts expected, with Azure growing 43% and passing $100bn of full-year revenue for the first time. Meta Platforms reported the same evening. Both landed after Wednesday's close, so their share price consequences fall outside this review.

US and global markets

Wall Street's week was the mirror image of London's. Wednesday was brutal: the Dow Jones Industrial Average fell 1,153.18 points, or 2.19%, to 51,594.14, its worst day since April 2025. The S&P 500 dropped 1.52% to 7,316.15 and the Nasdaq Composite lost 1.74% to 24,442.94, leaving it more than 10% below its all-time high. The trigger was the bond market's reaction to the Federal Reserve's decision, with the 10-year Treasury yield rising seven basis points above 4.67%.

The semiconductor sell-off that had begun in Asia deepened through the week. Tuesday was extraordinary in South Korea, where the Kospi fell 10.84% to 6,023.66 — among the largest single-day declines in its history — triggering a market-wide circuit breaker. Samsung Electronics fell more than 13% and SK Hynix around 14.7%; the two account for more than 40% of the index. Japan's Nikkei 225 dropped 3.95% to 62,364.92 and Kioxia fell more than 18%. In the US, Dell Technologies tumbled 8% and Intel slid 6%, and the Nasdaq-100 entered correction territory. Concerns centred on the sustainability of AI-related capital spending and on signs of progress in China's advanced chipmaking, including the listing of memory maker CXMT.

Europe held up far better. Monday saw Germany's DAX add 1.2% and France's CAC 40 gain 0.86%, with both indices proving more resilient than Asia through the chip rout.

Macro and data

The Federal Reserve was the set-piece event. On Wednesday the Federal Open Market Committee voted 9-3 to leave the target range for the federal funds rate at 3.50%-3.75%, a fifth consecutive hold. The three dissenters — Beth Hammack of Cleveland, Neel Kashkari of Minneapolis and Lorie Logan of Dallas — each preferred a 25 basis point increase, reflecting inflation that has run above the 2% target for an extended period. The statement noted that economic activity is expanding at a solid pace despite elevated uncertainty owing in part to the conflict in the Middle East.

In the UK, the Bank of England published its Money and Credit figures for June on Wednesday. Mortgage approvals for house purchase rose to 58,200 from 56,600 in May, though that remained below the previous six-month average of 61,400. Net mortgage borrowing jumped to £7.7bn from £3.3bn, and the effective interest rate on newly drawn mortgages rose to 4.35% from 4.22%. Net consumer credit borrowing edged up to £1.8bn from £1.7bn, with credit cards accounting for £0.9bn against £0.6bn in May. The Monetary Policy Committee's own meeting concluded on Wednesday, with the announcement scheduled for the following day.

In currencies and metals, sterling traded around $1.3360 on Wednesday, edging higher after four consecutive days of losses as the dollar stayed subdued ahead of the Fed. Gold was near $4,046 an ounce on Tuesday, down around 0.65% on the day and holding below $4,100, but roughly 21.6% higher than a year earlier.

Still to come

The diary is dominated by US second-quarter earnings and Friday's US labour market data.

Persimmon's interim results on 6 August will be its first substantive update since April's annual general meeting statement, when the housebuilder reported a 7% rise in private forward sales for the opening months of the year.

This article is for information and education only. It is not financial advice or a recommendation to buy, sell or hold any investment. Always do your own research.