Let us start, then, with the market's main focus right now: oil. Yesterday, the International Energy Agency proposed releasing 400 million barrels from the strategic reserves of its member countries. The aim was to ease a market under strain since the de facto closure of the Strait of Hormuz and, in turn, bring prices back down. Yet the announcement failed to trigger any significant moves. A few hours earlier, when Bloomberg broke the story, Brent crude had actually risen by $3 a barrel. That was a fairly counter-intuitive reaction, since more supply in a market should normally push prices lower.

And yet we are talking here about mobilising up to a third of IEA members' reserves. But drawing on strategic stockpiles signals to investors that disruption in the oil market is likely to last for some time. Besides, the balance in the oil market is a matter of flows, not stocks. The key question is how many additional barrels can be brought to market each day. Citigroup estimates that between 11 million and 16 million barrels a day from the Persian Gulf are currently missing. The release of strategic reserves can cover only part of that gap.

This morning, Brent crude climbed back towards $100 a barrel after two tankers were struck in Iraqi territorial waters. Against that backdrop, inflation fears remain front and centre. Yesterday, the US February CPI figures prompted little reaction from markets. While core inflation fell to its lowest level in five years, investors are now broadly expecting it to pick up again in the months ahead, given the impact of the energy shock, if it persists.

Wednesday's session ended in the red for European indices, dragged down by defence stocks. Rheinmetall's results disappointed investors. The shares closed down 8%, pulling the rest of the sector lower with them. On Wall Street, the close was mixed: -0.08% for the S&P 500, +0.03% for the Nasdaq and -0.61% for the Dow Jones.

Looking back over the past ten days, US indices have held up well. The S&P 500 is down just 2% since Friday 27 February, the day before the launch of the US-Israeli operation. The decline has been steeper in Europe, which is more exposed to the energy shock. The Stoxx 600 is down 5% over the period. Even so, that remains a limited pullback for indices that were trading close to record highs.

Equities therefore still seem to be buying into the idea of a short conflict. That view has been reinforced by Donald Trump's various remarks since the start of the week. After saying that the war could end "very soon", he told Axios yesterday that, in any case, there was nothing left to destroy in Iran.

But are markets not overestimating his ability to write the script? This is not Liberation Day. It is not simply a matter of imposing tariffs and then lifting them again. The US president has triggered a regional conflict with global repercussions. Iran's Revolutionary Guards have in fact told Donald Trump that they will decide when the conflict ends. They could hardly say anything else, of course. But even a badly weakened Iranian regime may retain a considerable capacity for disruption and could interfere with traffic through the Strait of Hormuz for months.

This afternoon, markets will digest a fresh batch of US economic data, covering jobs, housing and trade. But attention lies elsewhere. On oil, certainly, but also on what is known as private debt. In other words, the huge volume of loans extended by non-bank financial institutions to private companies and then repackaged into various products, some of them valued rather aggressively, to put it politely. It is a lucrative and opaque market. Does that ring any bells? Signs of strain have been multiplying in recent weeks, and seasoned financiers have been sounding the alarm almost daily. I led this morning with two stories, but a third may well gather weight in the days ahead.

Today, the rebound in oil towards $100 a barrel is likely to weigh once again on sentiment. Across Asia-Pacific, indices are in the red. Tokyo closed down 1.5%, while the MSCI Asia Pacific index lost 1.6%. European leading indicators are firmly in negative territory this morning, in line with Wall Street futures.

Today's economic highlights:

On today's agenda: the RICS House Price Balance and the speech by BoE Governor Bailey in the United Kingdom; In the United States, initial jobless claims, housing starts, preliminary building permits, balance of trade, exports, imports, and the Fed Bowman speech; In Canada, the balance of trade. See the full calendar here.

  • GBP / USD: US$1.34
  • Gold: US$5,166.71
  • Crude Oil (BRENT): US$97.53
  • United States 10 years: 4.23%
  • BITCOIN: US$69,473.4

In corporate news:

  • International Personal Finance shareholders approved the revised takeover offer by BasePoint Capital, including a special dividend, with completion targeted for Q2 2026.
  • Legal & General Group reported FY25 operating profit of £1,623m, up 6% year-on-year, but highlighted concerns over its weakened capital position and sustainability of shareholder returns.
  • Hill & Smith reported a 6.5% increase in FY25 pretax profit to £111.3 million and raised its dividend by 8% to 53.0 pence per share.
  • Revolut received a full UK banking license, enabling it to offer protected deposit accounts and expand its services.
  • Balfour Beatty reported a 51% surge in FY25 pretax profit to £323 million and announced a £200 million share buyback for 2026.
  • Dar Global reported a significant increase in FY25 pretax profit to USD112.7 million and highlighted its expansion into Saudi Arabian developments.
  • Bodycote more than doubled its FY25 pretax profit to £74.5 million despite a 4% revenue decline and launched an £80 million share buyback program.
  • Breedon reported a 9% increase in FY25 revenue to £1.71 billion but a 16% drop in pretax profit to £105.3 million, while raising its dividend by 3.4%.
  • RWE reports lower net profit for 2025, but slightly less than expected.
  • SBM Offshore will replace Randstad in the Dutch AEX index.
  • Protector Forsikring replaces MPC Container Ships in the Norwegian OBX.
  • Holcim strengthens its position in Colombia.
  • Salvatore Ferragamo plans to close 70 stores in 2025 and 2026.
  • Allianz and Sun Life are considering bidding for HSBC Life Singapore, according to Bloomberg.
  • Munters announces the appointment of Stefan Aspman to succeed Klas Forsström as CEO.
  • Tilman Fertitta in exclusive talks to buy Caesars Entertainment.
  • Morgan Stanley also limits withdrawals from its private credit funds.
  • Anthropic in talks with Blackstone and other private equity firms to create an AI consulting joint venture, according to The Information.
  • Netflix to pay up to $600 million for AI production company InterPositive, according to Bloomberg.
  • Atlassian is laying off about 10% of its workforce.
  • Investors demanded significant concessions during Salesforce's $25 billion bond offering on Wednesday, according to the FT.
  • Microsoft is preparing its next Xbox console.
  • Palo Alto Networks is increasing its share buyback program by $1 billion.
  • Donald Trump plans to invoke an emergency law in favor of Sable Offshore as the company seeks to restart production at a group of offshore platforms in California.

See more news from UK listed companies here

Analyst Recommendations:

  • Severn Trent Plc: BNP Paribas initiates coverage with a neutral rating and a target price of GBX 2550.
  • Hochschild Mining Plc: RBC Capital maintains its outperform rating and raises the target price from GBX 625 to GBX 920.
  • Atalaya Mining Plc: RBC Capital maintains its outperform rating and raises the target price from GBX 1075 to GBX 1525.
  • Fresnillo Plc: RBC Capital maintains its sector perform recommendation and raises the target price from GBX 3200 to GBX 3700.
  • Molten Ventures Vct Plc: RBC Capital maintains its outperform recommendation and raises the target price from GBX 4500 to GBX 6000.
  • Antofagasta Plc: RBC Capital maintains its sector perform recommendation and raises the target price from GBX 2900 to GBX 3600.
  • Greatland Gold: RBC Capital maintains its sector perform recommendation and raises the target price from AUD 11.70 to AUD 14.80.
  • Bodycote Plc: RBC Capital downgrades to sector perform from outperform with a target price of GBX 775.
  • J Sainsbury Plc: Barclays maintains its overweight recommendation and raises the target price from GBP 3.50 to GBP 3.60.
  • Rentokil Initial Plc: UBS upgrades to buy from neutral with a price target raised from GBX 430 to GBX 540.
  • Glencore Plc: UBS maintains its neutral recommendation and raises the target price from ZAR 11500 to ZAR 12500.
  • Legal & General Plc: AlphaValue/Baader Europe maintains its reduce recommendation and reduces the target price from GBX 243 to GBX 242.