June 29 (Reuters) - UK shares inched lower on Monday as renewed Middle East hostilities weighed on risk sentiment, while investors also awaited a highly anticipated speech from Andy Burnham, who is widely expected to be Britain's next prime minister.
The blue-chip FTSE 100 index fell 0.2% by 0949 GMT, while the midcap FTSE 250 slipped 0.1%.
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Consumer staple shares weighed on the FTSE 100 after British American Tobacco dropped 1.6% on the tobacco giant's plans to reduce its workforce by 20%.
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Aerospace & defence stocks came under pressure with BAE Systems and Babcock falling 1.4% and 7%, respectively. The Ministry of Defence said on Sunday that the UK will scrap plans to replace its ageing destroyers to focus on drone warships.
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Mining shares were lower due to a decline in gold after the recent escalation in the Mideast fueled inflation concerns.
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Keeping losses in check were energy and financial shares.
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BT and Verizon announced a deal to combine their international enterprise operations into a 50:50 joint venture. Shares of the British telecoms group were marginally up.
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In politics, investors awaited Labour lawmaker Burnham's speech for clues on his fiscal policy plan and thinking on the economy.
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On the economic front, a survey showed British companies' expectations for growth in the coming quarter fell this month to their lowest level this year.
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Both the internationally focussed FTSE 100 and the domestically exposed FTSE 250 ended last week lower.
Reporting by Twesha Dikshit; Editing by Shailesh Kuber
Source: Reuters