London's FTSE 100 edged higher Friday, lifted by a major HSBC deal that buoyed financial stocks, even as geopolitical tensions in the Middle East kept investors cautious about energy markets. The blue-chip index rose 0.3% to 10,674.68 points, with both the FTSE 100 and the midcap FTSE 250 on track to end the week in positive territory. Main Developments HSBC shares climbed 1.2% after Allianz agreed to acquire its Singapore life insurance business for S$2.7 billion ($2.1 billion). The sale aligns with HSBC's strategy to streamline operations and sharpen its focus on core Asian banking activities. Investment banks and brokerages led sectoral gains, rising 1.6%, with 3i Group surging 3.1% to top the benchmark index. UBS raised its target price on the investment company to 3,200 pence from 2,900 pence, fueling the advance. Read also: Newcastle Signs Monaco Midfielder Bamba in £30M Deal On the geopolitical front, U.S. President Donald Trump vowed “major military punishment” for Iran and its Houthi allies after the Yemeni fighters struck two Saudi oil tankers in the Red Sea. The attack heightened concerns about energy flow disruptions and a broader regional conflict, though oil prices later retreated. Energy shares fell 1.1%, with BP and Shell down 1.6% and 0.9% respectively. Meanwhile, the United States imposed new tariffs of 10% and 12.5% on goods from 60 trading partners, adding another layer of uncertainty for global markets. Background British retail sales unexpectedly rose in June, official data showed, as warm weather and the soccer World Cup boosted consumer spending. The positive figures add to evidence of a pickup in economic activity despite ongoing geopolitical strains. British firms reported their first growth in three months in July, helped by a brief respite in the U.S.-Iran war. Among individual stocks, discoverIE jumped 12.5% to lead the FTSE midcap index after the electronics components maker said annual earnings are expected to exceed market expectations. Why It Matters The FTSE 100's resilience highlights the tug-of-war between corporate deal-making and geopolitical risk. HSBC's Singapore deal signals continued consolidation in Asian insurance markets, while the Middle East tensions threaten energy supply chains and could fuel further volatility in oil prices. For British investors, the combination of rising retail sales and easing domestic business conditions offers a counterweight to external shocks. However, new U.S. tariffs on 60 trading partners and the risk of a broader Iran conflict mean the outlook remains fragile. What's Next Investors will watch for further escalation in the Middle East and any impact on oil markets. The U.S. tariffs are set to take effect soon, which could pressure trade-exposed sectors. HSBC's sale of its Singapore life unit is expected to close pending regulatory approvals, and 3i Group's revised target price may attract further buying interest.