British stocks clawed back early losses on Tuesday after U.S. inflation cooled unexpectedly in June, though a fresh jump in oil prices tied to escalating US-Iran hostilities kept the mood fragile. The FTSE 100 pared its decline while continental peers stayed lower.
Cooler U.S. price data steadied London trading even as crude climbed. The FTSE 100 was last down 0.06% as of 09:03 ET (13:03 GMT), recovering from steeper losses earlier in the session. Germany's DAX fell 0.40%, while France's CAC 40 dropped 0.55%. Sterling extended gains against the dollar, up 0.43% at $1.3406.
Softer inflation eases pressure
The turn followed the June inflation print. U.S. consumer prices fell 0.4% month-on-month in June and were up 3.5% year-on-year, Bureau of Labor Statistics data showed, driven by the steepest drop in gasoline prices since 2022. Core CPI, excluding food and energy, was flat on the month and up 2.6% annually.
Oil rally keeps sentiment fragile
Crude worked against the equity recovery. Oil extended its rally, with Brent crude touching a fresh one-month high above $86 a barrel after U.S. President Donald Trump said the U.S. was reinstating its blockade of Iranian ports and would impose a 20% security fee on cargo transiting the Strait of Hormuz. The escalation follows Trump's formal notification to Congress, in a letter dated July 10 reported by CBS News, that hostilities with Iran resumed on July 7 after a ceasefire reached in April collapsed.
By late morning, Brent was up 4.4% at $86.92 a barrel and WTI up 3.3% at $80.69. Gold futures rose 1.81% to $4,078.20 an ounce, while spot gold gained 1.82% to $4,073.88.
UK retail growth slows
At home, the consumer picture softened. UK retail sales growth slowed sharply in June, with shoppers shifting online during the heatwave, data from the British Retail Consortium and KPMG showed Tuesday. Total sales rose 1.9% year-on-year, down from 3.7% in May and below June 2025's 3.1% pace. In-store non-food sales fell 1.1%, while online non-food sales rose 5.1%, easing from May's 11% surge.
Source: Investing.com
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