London equity markets experienced a tentative start to September following renewed US strikes on Iranian targets amid escalating tensions in the Strait of Hormuz. The increased hostilities have amplified concerns over rising energy prices and the potential for higher borrowing costs to counter inflationary pressures.

Oil prices were a significant driver of trading activity. Brent crude, the global benchmark, increased by 4.3 percent to $94.28 per barrel, buoying shares of major energy companies. BP led gains on the FTSE 100 with a 5.2 percent rise, reaching 541¼ pence, while Shell shares climbed 2.6 percent to £34.32½. Despite these advances in the energy sector, the FTSE 100 index closed 34.98 points, or 0.3 percent, lower at 10,789.28. This marked the index’s third decline in four sessions and its lowest close since August 20.

Other sectors showed mixed performance. Tesco shares rose 3.1 percent to 471½ pence, supported by the announcement that its Clubcard members can now earn points when charging electric vehicles at Be.EV charging bays. This development contributed to Tesco’s overall monthly gain of 2.2 percent.

In contrast, the gold market retreated, with prices falling 1.9 percent to $4,393.50 an ounce in London. This decline negatively affected mining stocks, including Endeavour Mining, which dropped 5.4 percent to £44.84, and Mexico-based Fresnillo, down 4.9 percent at £30.16.

The FTSE 250 index also felt pressure, falling 417.50 points, or 1.7 percent, to 24,521.29. Commodity firms were among the most affected, with Hochschild Mining and Atalaya Mining both declining by around 6.1 percent to 626½ pence and £10.41, respectively. Pan African Resources fell 5.9 percent to 128½ pence.

Away from commodities, Oxford Biomedica faced the steepest decline on the FTSE 250, losing 14.7 percent to 447 pence. Investor apprehension grew amid reports that the cell and gene therapy company may still be open to a full take-private deal, despite having received multiple offers from the Swedish private equity firm EQT.

Overall, the markets reflected an environment of geopolitical uncertainty and shifting commodity prices, with investors weighing the risks related to Middle East tensions and their impact on inflation and corporate earnings.