By Basant El-Faramawy
London stocks closed lower on Tuesday as a fresh US strike on Iran heightened market nerves ahead of US midterm elections. The FTSE 100 dropped 1.1% to 10,638.43, while the FTSE 250 fell 0.5% to 24,674.91.
European and US Markets Mixed
In Europe, the CAC 40 in Paris ended down 0.2% and the DAX 40 in Frankfurt shed 0.5%. Around the London close, US markets were mixed: the Dow Jones Industrial Average slipped 0.3%, the S&P 500 rose 0.5%, and the Nasdaq Composite gained 0.9%.
Midterm Elections Drive Investor Caution
Investors remained wary as US voters headed to the polls in midterm elections that could see Democrats gain control of Congress. All 435 House seats are contested, with Democrats needing a net gain of four seats for a majority. In the Senate, 35 seats are up, and Democrats also need a net gain of four to secure control. Ulrike Hoffmann-Burchardi, global head of equities at UBS Chief Investment Office, said a “blue sweep” remains the highest probability outcome, though the Senate race is tight and the size of any majority uncertain.
US Strike on Iran Hits Oil Prices
President Donald Trump confirmed the US launched a strike on an Iranian anti-aircraft facility on Qeshm Island in the Strait of Hormuz, calling it a “minor attack.” The strike came hours after Trump suggested a deal with Iran “could happen.” Brent crude edged lower to $103.24 a barrel, down from $105.09 on Monday. Analyst David Morrison of Trade Nation said the likelihood of a peace deal “being reached anytime soon looks slim at best.”
Job Openings Data Shows Resilient Labor Market
US job openings rose to 7.523 million in September, exceeding the 7.13 million forecast, according to the Bureau of Labor Statistics. The data precedes Friday’s jobs report, where economists expect 65,000 jobs added in October, up from 29,000 in September.
Corporate Movers: Hiscox Gains, AB Foods Falls
On the FTSE 100, insurer Hiscox rose 3% after reporting a nearly 10% increase in insurance contract written premiums in the first nine months of 2026. Primark owner AB Foods fell 2.2% as full-year results failed to inspire; the company trimmed its grocery outlook and forecast its sugar unit to remain loss-making.
Miners Pressured by Weak Metals
Weak metals prices weighed on miners. Gold fell to $3,933.38 an ounce, silver dropped 1.6%, and copper declined 2.5%. Endeavour Mining, Glencore, Antofagasta, and Anglo American all traded lower.
IWG and Drax Rise on Positive Outlook
On the FTSE 250, International Workplace Group gained 8.6% after saying it expects to beat 2026 consensus estimates and raised its adjusted EBITDA guidance. Drax added 6.6% after announcing a partnership with Brookfield Asset Management to develop an AI data centre at its North Yorkshire power station, with potential investment exceeding £20 billion.
Upcoming Economic Events
Wednesday brings a raft of PMI reports, Eurozone inflation figures, US trade data, and the ADP jobs report. Corporate calendars include half-year results from Marks & Spencer and a trading statement from Barratt Redrow.
