Source: Sharecast
At 0830 BST, the FTSE 100 was up just 0.1% at 10,234.66, while Brent crude was 0.4% lower at $91.12 a barrel and West Texas Intermediate was also off 0.4%, at $87.85.
Summing up the latest events in the Middle East, Danske Bank said: "Iran's Revolutionary Guards struck a US base in Jordan and 21 other Gulf targets in retaliation for US attacks near the Strait of Hormuz, which were themselves triggered by the alleged downing of a US helicopter."
Away from the conflict, investors will turn their attention to the US consumer price index for May, which is due at 1330 BST.
Susannah Streeter, chief investment strategist at Wealth Club, said that while the latest skirmishes between the US and Iran, including the downing of an American Apache helicopter, are proving unsettling, US inflation data will be the key market driver.
"The CPI numbers are set to show another painful rise in costs for consumers, who are already grappling with sharp increases in the costs of everyday goods," she said. "The expectation is that the headline rate will rise to 4.2% year-on-year with a 0.5% jump in May. The big concern is that elevated wholesale energy costs are spreading and settling into the broader economy.
"The latest attacks in the Middle East indicate that the conflict is entrenched and increasingly hard to solve."
In equity markets, WH Smith tumbled as it cut profit guidance for the second time this year as war in the Middle East curtailed travel and weighed on consumer demand. The retailer now expects full-year headline profits before tax and non-underlying items to come in between £75m and £90m, down from previous guidance for between £90m and £105m.
The chain, which has shops in airports, rail stations and hospitals, also announced plans for a capital raise representing 20% of its share capital.
Pennon shares fell even as the South West Water owner said it swung to a full-year profit, with water revenue up 24.6%, mainly driven by the benefit of increased regulatory allowances and higher consumption.
Market Movers
FTSE 100 (UKX) 10,234.66 0.07%
FTSE 250 (MCX) 22,868.38 0.13%
techMARK (TASX) 5,913.69 0.46%
FTSE 100 - Risers
Smurfit Westrock (DI) (SWR) 3,072.00p 2.71%
Smith & Nephew (SN.) 1,175.00p 1.73%
BT Group (BT.A) 200.50p 1.65%
IMI (IMI) 2,856.00p 1.64%
Metlen Energy & Metals (MTLN) 41.21p 1.46%
InterContinental Hotels Group (IHG) 162.40p 1.44%
Tesco (TSCO) 463.10p 1.43%
Sainsbury (J) (SBRY) 308.20p 1.41%
Imperial Brands (IMB) 2,779.00p 1.39%
Marks & Spencer Group (MKS) 367.00p 1.38%
FTSE 100 - Fallers
HSBC Holdings (HSBA) 1,287.80p -1.72%
The Sage Group (SGE) 840.80p -1.17%
United Utilities Group (UU.) 1,288.00p -1.15%
Standard Chartered (STAN) 1,794.00p -0.99%
Severn Trent (SVT) 2,890.00p -0.96%
Experian (EXPN) 2,602.00p -0.73%
Rightmove (RMV) 432.80p -0.64%
Centrica (CNA) 185.25p -0.43%
Relx plc (REL) 2,593.00p -0.42%
St James's Place (STJ) 1,134.50p -0.39%
FTSE 250 - Risers
W.A.G Payment Solutions (EWG) 111.40p 6.50%
Premier Foods (PFD) 210.00p 3.55%
Diversified Energy Company (DI) (DEC) 1,064.00p 3.30%
Morgan Advanced Materials (MGAM) 222.00p 2.94%
Dr. Martens (DOCS) 74.50p 2.90%
Zigup (ZIG) 457.00p 2.24%
Ruffer Investment Company Ltd Red PTG Pref Shares (RICA) 304.50p 1.84%
Frasers Group (FRAS) 752.50p 1.69%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 455.50p 1.67%
The Renewables Infrastructure Group Limited (TRIG) 72.70p 1.54%
FTSE 250 - Fallers
WH Smith (SMWH) 413.00p -14.95%
Pennon Group (PNN) 486.60p -4.00%
Aston Martin Lagonda Global Holdings (AML) 41.00p -3.35%
Raspberry PI Holdings (RPI) 892.75p -3.00%
Target Healthcare Reit Ltd (THRL) 102.40p -2.66%
SSP Group (SSPG) 163.80p -2.28%
Shawbrook Group (SHAW) 302.75p -2.18%
Pets at Home Group (PETS) 180.00p -1.80%
Harbour Energy (HBR) 253.80p -1.79%
Pacific Horizon Inv Trust (PHI) 1,074.00p -1.65%