The FTSE 100 experienced a drop of 0.11%, and the FTSE 250 followed suit with a decrease of 0.12%. Automotive shares are falling as they mirror the downward movement of their European peers. Gold shares excel as the precious metal hits a record peak. London stocks saw a minor drop on Monday, affected by a slump in the automotive sector and the robustness of the pound, as investors awaited comments from several Federal Reserve officials later in the day. The benchmark index was down 0.11% at 1006, while the domestically-focused index fell 0.12%.

Stocks in British automobiles and parts declined by 1.6%, reflecting a downturn in the wider European automobile sector following Porsche’s decision to reduce its electric vehicle rollout plans. This adjustment has led both the luxury sportscar manufacturer and its parent company, Volkswagen, to revise their profit outlooks for 2025 downward. British luxury carmaker Aston Martin experienced a decline of 3.2%. Sterling’s strength against the greenback has also affected export-oriented firms, as investors paused to reevaluate after Friday’s selloff driven by fiscal concerns.
The Bank of England kept its key interest rates steady last week, addressing the ongoing challenges of persistent inflation and the uncertainties related to employment and economic growth.

Concerns dominated the overall sentiment after a report came out on Friday showing that Britain’s borrowing exceeded official projections, increasing the pressure on Finance Minister Rachel Reeves as she prepares for her November budget. Precious metal miners increased by 5.1%, leading all sectors, as gold reached a record high amid growing expectations for a more dovish rate path. Miner Fresnillo was among the top gainers in the FTSE 100, experiencing a 4% increase, while Hochschild surged by 8.8%. Other miners, including Glencore and Rio Tinto, experienced increases of 1.2% and 1.4%, respectively. An index of industrial metal miners saw an increase of 1.3%, reflecting the rise in copper prices. Airlines in London faced a decline due to delays at European airports, linked to a reported cyberattack. EasyJet, British Airways owner IAG, and Wizz Air experienced declines ranging from 1.3% to 1.5%.

British food ingredients maker Tate & Lyle experienced a decline of approximately 6%, marking the largest drop on the FTSE 250, following a downgrade by Morgan Stanley from “equal-weight” to “underweight.” Market participants will be focused on remarks from at least five Federal Reserve officials later on Monday, with Chair Jerome Powell set to speak to the public on Tuesday after the recent 25-basis-point rate cut.