London markets slip as commodity shares drag FTSE indexes

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London markets slip as FTSE falls

Highlights

FTSE 100 fell 0.7% and FTSE 250 slipped 0.6% by 0907 GMT as energy, chemicals, and mining shares led declines amid weaker commodity prices.
Shell and BP each dropped over 1% as crude prices slid about 2% after Hormuz shipping resumed, while chemical stocks lost 2.8%; Wise surged 7.6% on rising customer numbers and a new share purchase plan.
Markets are pricing in at least one 25-basis-point Bank of England rate hike this year as investors monitor UK political developments and inflation pressures.

Commodity losses and company moves

As reported by Reuters, the FTSE 100 is down 0.7% by 0907 GMT and the FTSE 250 is slipping 0.6%, with energy, chemicals and mining stocks leading the declines.

Energy shares are pressuring the blue-chip index, with Shell and BP each falling more than 1% as crude prices slide about 2% after shipping through the Strait of Hormuz resumes. A stronger dollar, driven by global uncertainty over technology shares and inflation concerns, is also weighing on base and precious metal prices, pushing chemical stocks down 2.8% and leaving mining companies lower by more than 1% each.

Some defensive sectors are outperforming, with Food, Beverage and Tobacco and Personal Goods each edging up 1%. Money transfer company Wise is among the session's top gainers, rising 7.6% after saying active customers increased 21% to 18.9 million in fiscal 2026 and that it plans to start a new share purchase programme.

Political and rate outlook shape sentiment

The UK political backdrop is also in focus, with Andy Burnham widely expected to become the next prime minister after Keir Starmer resigned earlier this week. Investors are watching his fiscal policy plans closely, as well as who is likely to become the next finance minister.

The more domestically focused FTSE 250 is on track for modest weekly losses, while the internationally exposed FTSE 100 remains set for its biggest weekly gain in over a month as tensions in the Middle East ease. Travel and leisure stocks remain especially exposed to the conflict, and Heathrow Airport has lowered its 2026 passenger forecast while warning that profit could shrink this year.

Investors are also bracing for possible second-round inflation pressures. LSEG-compiled data show markets are pricing in at least one 25-basis-point interest rate hike by the Bank of England this year.

Earlier this week, London equities climbed as the FTSE 100 and FTSE 250 approached weekly highs, supported by strong corporate earnings from financial and retail companies as well as renewed takeover activity involving easyJet, ITV and Advanced Medical Solutions. Friday's decline marks a reversal in sentiment as weaker commodity prices weigh on energy and mining stocks.

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