Feb 9 (Reuters) - The FTSE 100 dipped on Monday, as investors focussed on the brewing political crisis in Britain, while bank stocks came under pressure with NatWest leading declines after it agreed
FTSE 100 up as miners offset NatWest drop and market mulls politics
Market Overview and Political Context
By Sruthi Shankar
Mining Stocks Performance
Feb 9 (Reuters) - The FTSE 100 closed higher on Monday, as gains in mining stocks offset a NatWest drop after it agreed to buy wealth manager Evelyn Partners, while political uncertainty capped the gains.
NatWest's Acquisition Impact
The blue-chip index rose 0.16%, inching towards last week's record highs, while the FTSE 250 midcap was up 0.57%.
Political Developments
Wall Street's mood improved after last week's sell-off over concerns about artificial intelligence disrupting the business models of software and data services companies.
Bank of England's Interest Rates
London-listed precious metals miners jumped 5.3% as gold prices rose above $5,000 per ounce. [GOL/] Copper prices increased too, helping a broad index of industrial metal miners rise 3.8%. [MET/L]
British Prime Minister Keir Starmer's chief of staff, Morgan McSweeney, quit on Sunday, saying he took responsibility for advising Starmer to name Peter Mandelson as ambassador to the U.S. despite his known links to sex offender Jeffrey Epstein.
Starmer refused on Monday to heed calls to quit, even by the leader of his party in Scotland. Polls show he is hugely unpopular with voters after a series of U-turns. Longer-dated borrowing costs have risen in recent days, suggesting traders think Starmer may be forced out.
"Political pressure is building on Starmer to resign. If we do get shift in the premiership, the replacement is likely to be from the pro Left camp which would weigh on the currency and long-term bond yields," said Jefferies economist Mohit Kumar.
The Bank of England kept interest rates on hold last week, but only after an unexpectedly narrow 5-4 vote, and said borrowing costs are likely to fall if inflation eases further.
Data this week, including January retail sales and December GDP figures, could give more clues on monetary policy.
Weighing on the FTSE 100, NatWest Group slid almost 6% after it agreed to buy one of Britain's largest wealth managers, Evelyn Partners, for 2.7 billion pounds ($3.68 billion) including debt.
Greggs fell 2.4% after Jefferies warned that weight-loss drugs could curb sales growth by reducing demand from the bakery chain's customers.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Leroy Leo and Alexander Smith)
