FTSE 100 Best Month Since Iran Attacks: Market Update 2026

The FTSE 100 is on track for its best month since the first US attacks on Iran five months ago, despite a slight pullback in afternoon trading. The index reached a new record earlier today and is set to close the month up about 3.5% at around 10,840 points, recovering from a year low below 9,700 points during the March rout.

FTSE 100 Performance and Market Context

The FTSE 100's resilience is notable given the geopolitical turmoil triggered by the Iran conflict. The broader European Stoxx 600 index is also up 1.2% this month, after dropping 8% in March. This recovery reflects investor optimism about corporate earnings and economic stability, despite ongoing uncertainties.

Wall Street is also ending the month on a positive note, with the S&P 500 up 0.54%, Nasdaq up 0.92%, and Dow Jones up 225 points at the opening bell. This global market strength suggests a coordinated rebound from the earlier sell-off.

Key Drivers Behind the FTSE 100 Rally

Several factors have contributed to the FTSE 100's strong monthly performance. Energy stocks have surged due to higher oil prices, while defensive sectors like healthcare and consumer staples have provided stability. Additionally, a weaker pound has boosted export-oriented companies.

However, the month-end momentum has slowed slightly, with the index down 0.5% after 3pm BST. Investors are now focusing on central bank policy and inflation data for the coming months.

Major Business News Impacting the Market

Several key corporate developments have shaped the market narrative this week. BP has put its North Sea oil and gas business up for sale, ending six decades of production in the basin. This strategic move aims to streamline operations and focus on renewable energy investments.

In the retail sector, Morrisons reported widened losses of £926 million and cut nearly 5,000 jobs, highlighting the challenges of high debt and intense competition. Meanwhile, Sainsbury's agreed to sell Argos for £120 million to concentrate on its core food business.

Energy and Housing Market Updates

The price of petrol has hit a new Iran War high at UK forecourts, adding financial pressure on households planning summer holidays. Additionally, Great Britain recorded more new solar power installations in the first half of this year than any six-month period since 2011, signaling a shift toward renewable energy.

Economic uncertainty has dampened UK house price growth in July, as prospective buyers remained cautious about interest rates during the Iran war, which is typically the peak housebuying season.

Comparison of Market Indices Performance

Key Takeaways for Investors

• The FTSE 100 is on track for its best month since the Iran attacks, up 3.5%.
• Energy and defensive stocks have driven the rally, but momentum is fading.
• BP's North Sea sale and retail sector struggles are key corporate stories.
• UK petrol prices hit a new high, impacting consumer spending.
• Solar power installations surge, reflecting the green energy transition.

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