FTSE 100 Dips Amid Political Turmoil and Banking Sector Challenges

The FTSE 100 index experienced a minor decline on Monday as investor concerns mounted over political instability in Britain and mounting pressures on bank stocks. Notably, NatWest led the declines after announcing its acquisition of wealth manager Evelyn Partners.

British Prime Minister Keir Starmer is under scrutiny following the resignation of his chief of staff, Morgan McSweeney, amidst growing unpopularity and internal party criticism. This political uncertainty is having repercussions on the country's economic outlook.

NatWest's share plummeted by 5.5% post its acquisition deal announcement. Overall, UK banks saw a 1.2% drop as expectations grow for further rate cuts from the Bank of England, which recently maintained rates following a tight vote. Meanwhile, broader economic indicators, like recent trading forecasts and retail sales data, continue influencing market dynamics.