The UK's blue-chip FTSE 100 ticked lower on Wednesday after posting six straight quarterly gains as investors monitored the latest setback in U.S.-Iran talks, with gains in financials and industrials offsetting weakness in energy and mining shares.
The internationally focussed FTSE 100 index CURRENCYCOM:UK100 fell 0.1% by 0923 GMT, while the midcap FTSE 250 FTSE:MCX rose 0.4%.
Iran said on Tuesday it would not meet top U.S. envoys, following an outbreak of hostilities between the two nations, clouding the prospects of a peace agreement.
Precious FTSE:NMX551030 and industrial (.FTNMX551020) mining shares declined, weighing on the commodity-heavy FTSE 100 with Rio Tinto LSE:RIO and Fresnillo LSE:FRES down 1.1% and 1.7%, respectively.
Aerospace and defence shares (.FTNMX502010) extended gains from the prior session when Prime Minister Keir Starmer pledged an extra £15 billion ($20 billion) toward a defence boost. Babcock LSE:BAB, BAE Systems LSE:BA., Rolls-Royce LSE:RR. and Melrose Industries LSE:MRO rose between 1.7% and 4.9%.
PMI data showed that Britain's manufacturing activity cooled in June despite a boost from stockpiling ahead of price hikes and supply chain disruption worries.
Among individual movers, AB Foods LSE:ABF dropped 2% after the Primark owner said it expects annual profit to be below last year's. The food, beverage & tobacco index (.FTUB4510) slipped 1.5%.
Greggs LSE:GRG fell 3.8% and was the top laggard on the mid-cap index after the UK's biggest fast-food chain said its long-time CFO Richard Hutton would step down.
JD Sports LSE:JD. shed 2.1% after its retail partner Nike NYSE:NKE reported a decline in fourth-quarter revenue and said it expects a further revenue drop through the first half of 2027.
Both the FTSE 100 and FTSE 250 notched quarterly gains. The midcap index posted its biggest quarterly rise in five quarters, while the blue-chip index ended higher in 11 of the last 12 months.