The FTSE 100 finished little changed on Monday as investors balanced stronger energy stocks against growing concerns over escalating tensions in the Middle East. The UK's benchmark index edged up just one point to close at 10,498.29, while the FTSE 250 posted modest gains and the AIM All-Share index slipped lower.

Market sentiment remained cautious after renewed military action between the United States and Iran pushed oil prices higher. Brent crude climbed above $79 per barrel, reflecting fears that continued conflict around the Strait of Hormuz could disrupt global energy supplies.

The latest developments came after the United States launched additional strikes on Iran, prompting retaliatory actions by Tehran. US President Donald Trump announced plans to impose charges on cargo passing through the Strait of Hormuz while maintaining measures against Iranian shipping, further increasing geopolitical uncertainty.

The rise in crude oil prices boosted shares of major energy companies, with BP and Shell among the strongest performers on the FTSE 100. Shell also announced the sale of its Solenergi Power business, including the Sprng Energy group, to Aditya Birla Renewables.

Analysts warned that sustained increases in oil prices could fuel inflation and delay interest rate cuts, creating fresh challenges for global economies. Investors also continued to monitor weakness in technology stocks, with semiconductor companies in Asia and the United States experiencing significant declines.

Housebuilding stocks gained after reports suggested incoming UK Prime Minister Andy Burnham may consider reviving the Help to Buy scheme to support the housing market. Shares of Persimmon, Barratt Redrow and Taylor Wimpey all moved higher on the news.

Meanwhile, recruitment firms PageGroup and Hays surged after stronger-than-expected trading updates raised hopes of improving hiring activity. Luxury retailer Watches of Switzerland also advanced ahead of its latest trading statement and reports of possible takeover interest.

Investors are now looking ahead to key economic data, including US inflation figures, UK retail sales, and China's latest trade data, which could influence market direction in the coming days.