London Market Struggles Amid Rising Oil Prices and Inflation Worries

The London market opened flat on Tuesday as investors remained cautious due to rising oil prices and concerns about inflation. The FTSE 100 index started the day down just 1.36 points at 10,861.14. Meanwhile, Brent crude oil surged to $89.25 a barrel.

Swissquote analyst Ipek Ozkardeskaya noted that risk appetite is weakening globally alongside rising oil prices, which are fueling global inflation expectations and pushing yields higher. Today's cautious mood will likely persist as investors wait for the US consumer price index reading on Wednesday, which could impact Federal Reserve interest rate expectations.

Gold prices climbed to $4,360.52 an ounce early Tuesday morning, but market participants remained wary of a potential hawkish shift in central bank policies. In London, Spirax, IHG, and Legal & General were among the worst performers on the FTSE 100 index. Spirax reported a 54% increase in first-half earnings, while IHG's pretax profit shrank 8.7%. Legal & General received recommendation cuts from Goldman Sachs, UBS, and Citigroup.