FTSE 100 Slips as Rally Fades Amid Tariff Easing

The blue-chip FTSE 100 saw a downturn on Monday, as an initial relief rally driven by diminished geopolitical tensions and U.S. tariff concerns failed to sustain. While the index ended 0.4% lower, it marked its second consecutive quarterly gain. The UK's midcap FTSE 250 index, despite closing 0.4% down for the day, registered its most significant quarterly gain in nearly five years.

Midcap stocks, predominantly domestic, showed resilience against tariff disruptions due to their limited international trade exposure. Nonetheless, the UK remains exceptional, maintaining a trade deal with the U.S. Aerospace and defence stocks, such as Rolls-Royce, rose 1.2%, catalyzed by the recent termination of a 10% tariff on aircraft components under the new U.S.-UK trade agreement.

Britain's economy reflected growth at its peak rate in the first quarter of 2025. Nevertheless, analysts forecast a slowdown. Notable individual stock movements include WH Smith's 3.4% decline after revising cash expectations from a sale, and GSK dropping 1.1% post-investigation announcements. Centrica shares also fell slightly after a ratings downgrade by J.P. Morgan.

(With inputs from agencies.)