FTSE 100 pulls back from record as ME tensions escalate
The blue-chip FTSE 100 closed down 0.4%, less than 1% away from an intraday record high.
Israel launched strikes against Iran on Friday, targeting nuclear facilities and ballistic missile factories, to prevent Tehran from building an atomic weapon. The Islamic Republic insists it wants nuclear energy only for civilian purposes.
Israel said Iran had launched around 100 drones towards Israeli territory in retaliation on Friday, but Iran denied this and there were no reports of any drones reaching Israeli targets.
The development adds to caution among investors, who are already grappling with the impact of US President Donald Trump's erratic tariff policies.
The heightened tensions sent prices of crude soaring about 6% and weighed heavily on travel and leisure stocks.
British Airways owner ICAG fell 3.7%, EasyJet dropped 2.7%, while Wizz Air was down 5.6%. Global airlines cleared out of airspace in the Middle East, diverting flights.
London-listed shares of cruise operator Carnival were down 3.4%.
Gains in commodity-linked stocks capped declines in the blue-chip index, with energy shares rising 0.8%, boosted by oil giants Shell and BP.
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