UK’s FTSE 100 inched down on Monday as rating downgrades on index heavyweights Rolls-Royce and Unilever weighed at the start of a data-filled week worldwide, including a jobs reading in the United States.
The blue-chip benchmark fell 0.2% as of 0947 GMT, compared with a 0.2% rise in the pan-European STOXX 600.
Aerospace and defence led losses amongst the major FTSE 350 sectors, falling 2.1%, bogged down by a 2.8% decline in Rolls-Royce after Citigroup downgraded its rating on the engineering company to “neutral” from “buy”.
A gauge of consumer staples firms shed 1.2% as index heavyweight Unilever eased 1.7% after RBC downgraded the consumer goods group to “underperform” from “sector perform”.
On the bright side, industrial support services gained 1% with Spectris adding 2.9% after HSBC upgraded the scientific instruments maker to “buy” from “hold”.
The more domestically focussed FTSE 250 midcap index was up 0.1%.
Meanwhile, a survey showed British business activity growth slowed to a crawl in December and employers cut staffing at the fastest rate in almost four years, on a continued decline in corporate morale after the government’s budget.
London’s FTSE 100 flat as gains in energy stocks cap declines
The FTSE 100 rose nearly 6% in 2024, its fourth successive yearly advance, as sentiments improved following two interest rate cuts by the Bank of England during the year.
However, implications of Finance Minister Rachel Reeves’s October budget and the potential policies of incoming US President Donald Trump have kept investors on edge.
This week’s centrepiece for global markets would be the December US nonfarm payrolls report due on Friday, a crucial metric in gauging the Federal Reserve’s interest rate path for 2025.
Trading volumes will likely improve this week as most market participants return after two weeks of holiday-affected trading.
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