FTSE Slumps as Middle East Conflict Continues; Europe Suffers Broad Sell-Off

The FTSE 100 has dropped around 2.2% on Tuesday, extending the sharp sell-off sparked by the deepening conflict between Iran and the United States and its allies.

The FTSE 250 has fallen 1.5%, while losses accelerated across Europe, with Germany’s DAX down 3.2% and France’s CAC 40 slipping 2.3%.

The war in the Middle East, now in its fourth day, continued to fuel risk aversion and pressure sectors most sensitive to geopolitical shocks. Travel stocks once again declined, with International Airlines Group (IAG) sliding 5.1%.

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Mining and financial stocks also retreated sharply. Losses included Antofagasta down 5.3%, Metaln down 4.4%, Prudential off 4.2%, Fresnillo down 4.1%, Barclays falling 4.1% and Anglo American down 4%.

Despite heightened geopolitical tension, precious metals softened, with gold and silver sliding after closing lower on Monday.

The biggest FTSE 100 faller was Intertek, down 11% despite reporting a third straight year of double-digit earnings growth. Adjusted operating profit rose 5% to £620 million on revenue of £3.43 billion.

Meanwhile, Greggs slipped 0.6% after posting slower sales growth and a fall in annual profit, deepening pressure on a stock already down 7.1% year-to-date and 25.8% over the past year. It remains the most shorted London-listed company, with short interest at 13.3%.