London shares mixed; midcaps eye best quarter in four years

(Reuters) -London’s stock indexes were mixed on Monday as a relief rally driven by easing geopolitical tensions and U.S. tariffs fizzled out, while midcaps were set for their largest quarterly gain in more than four years.

Both the blue-chip FTSE 100 and the FTSE 250 were flat by 1100 GMT. Last week, the indexes advanced after a truce between Iran and Israel, increased prospects of a dovish Federal Reserve, and some easing of tariff pressures.

The midcap index is set for its best quarterly showing since October 2020. Domestically focused stocks have been relatively insulated from tariff disruptions, as the UK remains the only country with a trade agreement with the United States.

The FTSE 100 has gained 7.7% so far this year, already exceeding its annual gains recorded since 2021.

Aerospace and defence stocks were up 1.2%, boosted by a 1.7% gain in Rolls-Royce, after the U.S.- UK trade deal came into effect and removed the 10% tariff on aircraft engines and parts.

Investors are closely monitoring further U.S. trade agreements ahead of former President Trump’s July deadline.

Data showed Britain’s economy grew at its fastest pace in a year during the first quarter of 2025; however, analysts expect growth to slow for the rest of the year.

Among individual stocks, WH Smith fell 2.7% to the bottom of the FTSE 250, after the company said it would receive less cash than expected from the sale of its UK high street business to Hobbycraft owner Modella Capital.

Pharmaceutical giant GSK was down marginally after a U.S. senator said Friday she was launching an investigation into the company’s discontinuation of a widely used asthma inhaler for children.

Gas owner Centrica was among the FTSE 100’s worst performers after J.P. Morgan downgraded its stock.

(Reporting by Twesha Dikshit; Editing by Tasim Zahid)