London pre-open: FTSE 100 to hit one-month low on Israel, China fears

The FTSE 100 is being called to open around 1.2% lower than Monday's close of 7,965.53, according to IG Group futures, which will put it at its lowest level since 20 March.

Oil prices were rising early on after Israel said it had no choice but to respond to Iran's 300-plus missiles and drones that were launched at the weekend. The initial muted reaction to Tehran's attack had a similarly subdued impact on the markets on Monday, though fears are now rising of a reprisal.

"Missiles into the territory of the State of Israel will be met with a response," said Herzi Halevi, chief of staff of the IDF, lifting Brent crude prices up 0.4% to $90.46 a barrel.

UK markets were also following Asian markets lower overnight, with the Nikkei 225 and Hang Seng both dropping 2% each, after economic data from China underwhelmed. GDP figures for the first quarter beat expectations, with annual growth rising to 5.3% from 5.2%, but standalone data for March showed that growth had started to tail off by the end of the quarter.

Chinese retail sales rose by just 3.1% year-on-year in March after 5.5% growth in February, while industrial production growth slowed to 4.5% from 7.0% – with both figures missing economists' expectations.

Back on home soil, the UK unemployment rate jumped to 4.2% in the three months to February, from an upwardly revised 4.0% in the three months to January, ahead of the 4.0% forecast by the market.

In equity news, QinetiQ Group announced Carol Borg's departure as group chief financial officer, effective immediately, with Martin Cooper appointed as her successor, expected to join by October. The FTSE 250 company said during the transition, Heather Cashin, the current group financial controller, would serve as interim group CFO, with support from former group CFO David Smith. Additionally, it said Iain Stevenson had been appointed as chief operating officer, joining from AWE in July, with Will Blamey promoted to chief executive of UK defence, effective immediately, both reporting to group CEO Steve Wadey.

UK bootmaker Dr Martens said chief executive Kenny Wilson has decided to step down as the company issued another profit warning for the current financial year amid continuing woes in the US, its biggest market. Wilson will be replaced by brand officer Ije Nwokorie before the end of the current financial year, Dr Martens said in a statement. "There is a wide range of potential outcomes for full-year 2025 given that we have only recently started the year. However, we have assumed that revenue declines by single-digit percentage year-on-year and ... we could see a worst-case scenario of profit-before-tax of around one-third of the 2024 level," it added.