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Stock prices in London were mostly lower at midday Monday after a weak UK construction activity print, however defence stocks performed well amid a renewed focus on Russia’s war in Ukraine. The FTSE 100 index was down 20.73 points, 0.2%, at 10,658.30. The FTSE 250 was down 25.32 points, 0.1%, at 23,513.48, and the AIM all-share was up 2.32 points, 0.3%, at 778.41. The Cboe UK 100 was down 0.1% at 1,057.77, the Cboe UK 250 was down 0.1% at 20,248.18, and the Cboe small companies was marginally higher at 18,412.65. 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. S&P Global said subdued housing market conditions, elevated borrowing costs, uncertainty and delayed project starts continued to weigh on activity. The pound was quoted at $1.3340 at midday Monday, lower compared with $1.3351 at the London equities close on Friday. Against the euro, sterling edged up to €1.1677 from €1.1672. The euro traded at $1.1419, down from $1.1440, while the dollar strengthened to JP¥162.31 from JP¥161.30. In European equities, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt added 0.2%. Elsewhere in Europe, data showed eurozone producer price inflation accelerated by more than expected in May, driven by higher energy costs following the US-Iran conflict. Producer prices rose 5.9% annually in May, quickening from a revised 5.0% increase in April and exceeding the FXStreet-cited consensus of 5.7%. Energy prices climbed 14% on-year, accelerating from a 12.5% rise in April. Geopolitical developments also remained in focus ahead of this week’s Nato summit in Ankara. US President Donald Trump is expected to meet Ukrainian President Volodymyr Zelenskyy during the summit as Washington steps up efforts to broker an end to the war. A senior US official said battlefield progress had effectively ‘frozen’ in recent months, with neither side making significant advances, adding that Trump would also press Nato allies to increase defence spending. The renewed focus on the conflict in eastern Europe supported defence shares across the continent. In London, BAE Systems rose 1.7% and Babcock added 1.2%. Germany’s Rheinmetall gained 1.8%, while Italy’s Leonardo climbed 4.3% and France’s Thales advanced 1.6%. Back in London, St James’s Place led the FTSE 100, rising 2.6% as it extended Friday’s gains after UBS raised its price target. At the other end of the index, Fresnillo fell 2.2%, Halma lost 1.9% and Diploma declined 1.5%. On the FTSE 250, easyJet remained the standout performer, up 10%, after announcing it had reached an ‘agreement in principle’ with Castlelake over the financial terms of a possible £5 billion, or $6.7 billion, takeover. Close Brothers Group fell 5.0% after RBC cut its recommendation to ‘sector perform’ from ‘outperform’ and lowered its price target to 470p from 625p. Ceres Power Holdings lost 2.9%, Renishaw shed 2.8%, while Ocado Group fell 2.6% after agreeing for founder Tim Steiner to remain chief executive until 2028. Among smaller caps, DeFi Development fell 12%, giving back part of last week’s gains after more than doubling in value. Knights Group Holdings rose 4.3% after reporting a 19% increase in underlying pretax profit to £33.2 million for the year ended April 30 from £28.0 million a year earlier and raising its total dividend by 17% to 5.63p from 4.81p. The legal and professional services firm said it had made a positive start to the new financial year and expects continued organic growth supported by resilient demand. Stocks in New York were called higher. The Dow Jones Industrial Average was called up 0.1%, the S&P 500 up 0.5% and the Nasdaq Composite up 1.1%. The yield on the US 10-year Treasury was quoted at 4.46%, unchanged from Thursday. The yield on the US 30-year Treasury was quoted at 4.98%, widening from 4.97% on Thursday. Investors will look to US S&P Global services and composite PMI readings at 1345 GMT. The services index is expected to improve to 51.3 points in June from 50.7 in May, while the composite PMI is forecast to rise to 52.2 from 51.5, according to the flash PMI published on June 23. Gold was quoted at $4,153.00 an ounce at midday Monday, down from $4,167.57 on Friday. Brent crude traded at $71.72 a barrel, little changed from $71.76. Elsewhere, Ireland’s unemployment rate edged up to 5.0% in June from 4.9% in May, according to the Central Statistics Office. The annual rate also rose from 4.6% a year earlier. Youth unemployment increased sharply to 10.8% from 9.9%, while the unemployment rate for those aged 25 to 74 held steady at 4.2%. Still to come on Monday’s economic calendar are the US composite PMI and ISM services PMI, alongside Canada’s composite PMI and the Bank of Canada’s business outlook survey. Copyright 2026 Alliance News Ltd. All Rights Reserved.
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