On Tuesday, London equities experienced a decline, coinciding with a significant drop in the pound attributed to finance minister Rachel Reeves’ remarks, amidst a global trend of falling equities in a broader risk-off environment. The blue-chip FTSE 100 dipped 0.7% by 1120, on track for its largest one-day decline in more than two weeks, should the losses persist. The midcap index experienced a decline of 0.5%. Industrial metal miners bore the brunt of the selling pressure, down 2.3%, as a stronger dollar sent copper prices tumbling more than 2%. Heavyweight banks lost 1.2%, with HSBC, Standard Chartered, and Barclays all down more than 1% each.

The sentiment was grim all across Europe, with bourses in Germany, France, and Italy down, as the pan-continental STOXX 600 hit its lowest since mid-October. U.S. stock index futures experienced a decline exceeding 1% across the board. In the interim, the pound and yields on UK government bonds experienced a decline following Rachel Reeves’ cautionary remarks regarding “hard choices” in a speech that deviated from the typical rhetoric expected from a finance minister merely three weeks ahead of her second annual budget presentation.

“Her speech was as much about managing expectations as setting direction,” stated Nigel Green. In the near term, the Bank of England is anticipated to halt its rate-cutting trajectory on Thursday; however, the recent decline in inflation and wage figures may bolster the argument for a reduction. Among individual stocks, Diversified Energy surged 9.6% following the company’s upward revision of its annual profit forecast in the oil and gas sector.

Energy giant BP reported a smaller than expected decline in third-quarter underlying profit. Its shares, however, experienced a decline of 0.5% after having increased approximately 1% earlier in the day. Associated British Foods fell 2.6% after the company indicated it could separate its Primark fashion shops from its food businesses and reported a 13% drop in full-year profit.