6th Jul 2026 17:07
(Alliance News) - The FTSE 100 gave back early gains on Monday as falls in gold miners and AstraZeneca, plus soft construction figures, dampened early enthusiasm.
The FTSE 100 closed down 27.26 points, 0.3%, at 10,651.77. The FTSE 250 ended down 34.58 points, 0.2%, at 23,504.22, while the AIM All-Share rose 2.65 points, 0.3%, at 778.74.
The Cboe UK 100 ended down 0.2% at 1,057.18, the Cboe UK 250 was down 0.3% at 20,216.12, while the Cboe Small Companies ended 0.1% higher at 18,422.58.
Data showed the UK construction sector remained deep in contraction during June, although the pace of decline eased slightly from May's six-year low.
The S&P Global UK construction purchasing managers' index edged up to 38.4 in June from 38.2 in May, remaining well below the 50-point threshold that separates growth from contraction.
Construction activity has now declined every month since January 2025, with June marking the second-steepest fall since the start of the pandemic. Housebuilding recorded its sharpest downturn of the year, while civil engineering activity fell to its weakest level since April 2020.
Rob Wood, chief UK economist at Pantheon Macroeconomics said there are few signs of a 'Burnham boost' to the mood music in the PMI, despite the incoming premier's apparent emphasis on investment spending.
"We estimate that the headline activity index is consistent with construction sector output falling by around 3.0% three-months-on-three-months, the same signal as in May," Wood added.
In European equity markets on Monday, the CAC 40 in Paris ended down 0.3%, while the DAX 40 climbed 0.2% in Frankfurt.
In New York, the Dow Jones Industrial Average was down 0.1%, the S&P 500 was up 0.7%, and the Nasdaq Composite was up 1.2%. Financial markets in the US were closed on Friday for the Independence Day public holiday.
The US services sector continued to expand in June with pricing pressures remaining elevated albeit easing month-on-month, two reports on Monday showed.
The headline S&P Global US Services PMI business activity index rose to 51.2 in June, below an earlier 'flash' reading of 51.3, but up from 50.7 in May. Although hitting a four-month high, the figure was below FXStreet consensus, which had forecast a bigger improvement to 51.4.
The upturn was supported by a faster increase in new business, which grew at its strongest pace since February, as firms responded to gradually stabilising economic conditions.
Meanwhile, a separate report from the Institute for Supply Management also showed the US services sector expanded in June.
The ISM services PMI registered 54.0 in June, the 24th consecutive month in expansion territory, in line with FXStreet consensus but down from May's figure of 54.5.
"The report shows services demand still expanding, hiring improving and cost pressures easing gradually - a mix the Fed is likely to view as consistent with patience rather than a clear green light to move," said analysts at TD Economics.
The euro traded lower against the greenback, at USD1.1417 on Monday against USD1.1440 on Friday. Against the yen, the dollar was trading at JPY162.34, up from JPY161.30 on Friday.
The pound traded at USD1.3354 on Monday afternoon, up from USD1.3351 on Friday. Against the euro, sterling firmed to EUR1.1696 from EUR1.1672 on Friday.
The US 10-year Treasury yield traded at 4.49% on Monday, stretched from 4.46% on Thursday, and the US 30-year Treasury yield widened to 5.00% from 4.97% on Thursday.
Brent crude for September delivery traded higher at USD72.13 a barrel on Monday, up from USD71.76 on Friday.
Gold traded at USD4,148.94 an ounce on Monday, down from USD4,167.57 on Friday.
In London, a 2.5% fall in the UK's second-most valuable company, the pharmaceutical firm AstraZeneca, weighed. Sector peer GSK was also weaker, down 1.6%.
The weak gold price pegged back Fresnillo, down 2.4%, and Endeavour Mining, down 2.5%.
On the FTSE 250, easyJet soared 9.3% as it said it has reached an agreement in principle for a takeover by US private equity firm Castlelake after a new proposal valuing the firm at over GBP5 billion.
The Luton-based budget airline said Castlelake's fifth proposal was for 690 pence per share, which they were "minded to recommend" to shareholders, provided a firm offer was made by August 3, the deadline set for the deal.
JPMorgan analyst Harry Gowers said the offer price is close/broadly in-line with recent investor feedback that around 700p per share is the level at which shareholders might seriously engage with Castlelake.
Gowers said the key questions now around the deal are: will the ownership and control structure put forward satisfy the easyJet board and regulators; will a counter-bidder emerge; and, if a firm offer materialises, will the majority of shareholders vote in favour of the deal?
ITV fell 0.1% after it said it will return GBP950 million to shareholders after agreeing to sell its Media & Entertainment business to Sky, a wholly owned subsidiary of Comcast, for up to GBP1.6 billion.
Through the deal, the London-based television broadcaster and content producer will receive GBP1.2 billion in cash, Sky's Love Productions business valued at GBP200 million, and up to GBP200 million in cash, payable in the second half of 2028 and linked to 2027 advertising performance.
Dan Coatsworth, head of markets at AJ Bell, said a "slimmed-down ITV would be an attractive takeover target for someone like Netflix looking to acquire production facilities and a rich library of content. Equally, ITV could be an acquirer itself, making bolt-on deals."
The biggest risers on the FTSE 100 were Relx, up 59.00p at 2,393.00p, St James's Place, up 29.00p at 1,332.00p, BAE Systems, up 43.50p at 2,025.00p, London Stock Exchange, up 182.00p at 8,852.00p and IG Group, up 29.00p at 1,892.00p.
The biggest fallers on the FTSE 100 were Compass Group, down 1.14p at 31.57p, Associated British Foods, down 58.50p at 1,898.50p, Coca-Cola HBC, down 145.00p at 5,025.00p, Halma, down 108.00p at 3,906.00p and Metlen Energy & Metals, down 1.10p at 41.64p.
Tuesday's global economic calendar has trade figures in the US and Canada, Halifax house price data in the UK and industrial production figures in Germany.
Tuesday's local corporate calendar has a trading statement from oil major Shell and third-quarter results from polymer producer Victrex.
By Jeremy Cutler, Alliance News reporter
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