- Labour Party suffers heavy local election losses, Reform UK gains ground
- British Airways owner says fuel costs will be 2 billion euros higher in 2026
- Intertek rejects third sweetened takeover bid from EQT
- UK house prices decline for second month as Iran conflict dampens demand
- FTSE 100 down 0.1%, FTSE 250 up 0.2%
May 8 (Reuters) - UK's FTSE 100 slipped on Friday as fresh clashes in the Gulf raised fears over a fragile month-long U.S.-Iran ceasefire, while investors digested early local election results showing heavy losses for Prime Minister Keir Starmer's Labour Party.
The blue-chip FTSE 100 index fell 0.1% to 10,261.38 points by 0947 GMT, and was set for a third consecutive weekly fall. The midcap FTSE 250 rose 0.2%, up for the third straight day.
-
Starmer said he would not resign after early results showed populist Reform UK party of Brexit campaigner Nigel Farage gained more than 350 council seats in England.
-
The results highlighted the splintering of Britain's two-party system into a multi-party democracy, a historic political shift, analysts said.
-
"Risks of a leadership challenge can rise post the May local elections, though it is not a given," strategists at Bank of America said in a note, adding "if a leadership challenge were to ensue, and a left-leaning Labour leader were to emerge, risks of higher borrowing would increase."
-
The British pound firmed, weighing on shares of UK multinationals that earn a large share of revenue abroad.
-
British Airways owner IAG fell 2.1% after warning its annual profit would be lower than forecast and flagged that jet fuel costs would be about 2 billion euros higher in 2026 than in 2025 due to the conflict.
-
Intertek shed 3% after rejecting a third sweetened 8.93 billion pound ($12.12 billion) takeover proposal from Swedish private equity firm EQT AB.
-
Global risk sentiment was fragile after the U.S. and Iran exchanged fire in the Middle East, even as U.S. President Donald Trump played down the hostilities. Oil prices rose back above $100 a barrel.
-
Domestic data showed British house prices fell in April for the second straight month as concerns about the impact of the war in Iran hurt buyer demand.
-
Focus will shift to the U.S. jobs report later in the day.
($1 = 0.7368 pounds)
Reporting by Medha Singh in Bengaluru; Editing by Shilpi Majumdar
Source: Reuters