The FTSE 100 index closed at 10,705.26 on Wednesday, down slightly, as positive U.S. economic data was overshadowed by tensions in the Middle East. The FTSE 250, which tracks smaller UK-based companies, dropped 0.7% to 24,361.58, while the AIM all-share index, which includes smaller, high-growth companies, fell 0.3% to 793.44. European stock markets also declined, with the CAC 40 in Paris down 0.4% and the DAX 40 in Frankfurt falling 0.7%. In the U.S., major indices like the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite also posted modest declines by the time London markets closed. London markets showed a brief rebound in the afternoon after a report indicated that U.S. business activity grew at the fastest pace in over five years in September. However, this improvement was quickly overshadowed by concerns over Iran’s stance on the Strait of Hormuz, a critical shipping route. Iran’s President Masoud Pezeshkian addressed the United Nations, warning against using the strait for aggression and emphasizing Iran’s resistance to international pressure and sanctions. Economic data from the U.S. showed strong growth, with the S&P Global flash U.S. composite PMI output index rising to 58.4 in September, the highest level in over five years. This suggests annualized economic growth of around 5% for the third quarter. In contrast, the UK saw a slight slowdown in private sector growth, with the S&P Global flash UK purchasing managers’ index falling to 51.7 points in September. However, analysts noted that activity remained strong overall. The British pound weakened slightly against the U.S. dollar and the euro, trading at 1.3254 dollars and 1.1636 euros, respectively. Meanwhile, oil prices rose following Pezeshkian’s remarks, with Brent crude reaching $102.74 a barrel. U.S. Treasury yields also increased, reflecting higher borrowing costs. In the UK, oil companies BP and Shell gained on the strength of oil prices, with BP receiving a positive rating upgrade from JPMorgan. However, retail firm JD Sports Fashion fell sharply after reporting weaker-than-expected results. On the FTSE 250, some stocks saw significant moves, with Pollen Street Group rising 13% as it explored strategic options, including a potential takeover. Ashtead Technology surged 54% after a takeover bid was announced. On the FTSE 100, the biggest risers were BP, Babcock International, Relx, BAE Systems, and Ithaca Energy, while the biggest fallers included JD Sports Fashion, Fresnillo, and Autotrader. Thursday’s schedule includes corporate reports from several major companies, as well as economic data from Germany and several European countries.