The FTSE 100 dipped slightly on Tuesday as investors took cash off the table ahead of the Federal Reserve’s interest rate decision.

London’s leading index was down 0.2% at the time of writing despite another fresh record high for US stocks.

The S&P 500 closed at 6,615 and is now 12% higher year-to-date – almost identical to the gains the FTSE 100 has recorded over the same period.

US tech stocks drove the S&P 500 to fresh record highs overnight, with Alphabet and Tesla storming higher. Tesla shares jumped after Elon Musk bought $1bn of Tesla stock in a move that will go a long way to quelling concerns about his dedication to the company.

Perhaps the softer moves in UK stocks were related to slightly negative sentiment around the UK jobs market, which showed more signs of deterioration in June.

“Signs of cooling are emerging in the UK labour market, but wage growth remains stubbornly high, still well above levels consistent with the Bank of England’s inflation target,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

“The slight dip in pay growth and falling payrolls suggest momentum is easing, yet services inflation remains sticky, keeping rate cut hopes firmly on ice. With UK rates likely on hold as we move into 2026, markets may need to recalibrate expectations around the timing and pace of policy easing.”

The BoE’s commentary around its rate decision this week will be pored over for a signal they may act to stem the slowing jobs market with a rate cut. However, as Britzman says, this seems unlikely with inflation remaining at elevated levels.

Another fresh record high for gold fuelled Fresnillo’s extraordinary rally with a 3% gain. The precious metals miner is now up 267% in 2025 alone.

Gold bulls are relishing the prospect of a more accommodative Federal Reserve, and the yellow metal was trading near $3,700 at the time of writing.

“The market has pushed gold to all-time highs for a reason, and while the exact reason could fall on any one of many macro debates and concerns being posed by market players, the fact that gold is uncorrelated from the S&P500 and US Treasuries and is a portfolio hedge that is working well makes the investment case highly attractive,” said Chris Weston Head of Research at Pepperstone.

Haleon was the FTSE 100’s top faller with a loss of 2.8%. Easyjet was not far behind with a drop of 2.6%.

It’s tough out there for housebuilders, and MJ Gleeson has demonstrated that rising revenues and completions aren’t enough to ensure sustainable profit growth.

MJ Gleeson reported annual results broadly in line with revised expectations, with housing completions rising to 1,793 homes sold compared to 1,772 the previous year.

However, profits declined as operating profit at the homes division fell 26% to £22.3m despite a 6% revenue increase to £348.2m.

The housebuilder’s gross profit margin on homes sold dropped to 20.7% from 24.1% the previous year. Group profit before tax fell 17% to £20.5m, though total revenue increased 6% to £365.8m. The group pointed to rising costs as olders sites incurred higher costs and extended site life increased overheads.

Gleeson Land performed strongly, with operating profit surging 218% to £7.0m from £2.2m. The division completed seven land transactions versus four previously.

There are some reasons to be positive. Net reservation rates have improved 8% in recent weeks to 0.54 per site per week.

The firm maintains ambitious plans to sell 3,000 homes annually, which could triple group profitability. These ambitions, coupled with a dividend maintained at 11p for the full year, will have helped provide some support for shares on Tuesday.

“This year has been challenging for Gleeson, and despite selling more homes relative to FY2024, there have been factors which stalled our momentum. We have taken the actions necessary to benefit the business through FY2026 and ensure the delivery of our strategic objectives,” said Graham Prothero, CEO of MJ Gleeson.

“Positively, Gleeson Homes significantly strengthened its forward order book in the year. Market demand has been steady, and we have maintained a robust sales rate, reflected in our net open market reservations rate, up 28% in the second half against the same period last year. Selling prices, however, remained constrained, with incentives continuing at an elevated level, restricting material margin improvement.”

The FTSE 100 was trading in a holding pattern on Monday as markets geared up for a busy week of central bank action, including interest rate decisions from the Bank of England and the Federal Reserve.

London’s leading index was trading higher by just 1 point at the time of writing.

“There’s a wait and see mood at the start of the week as investors eye key central bank meetings and assess the potential path of interest rate cuts,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“Warnings about higher food prices coming in the UK are likely to cause fresh worries about how long borrowers will have to wait until Bank of England policymakers vote for another cut. They are set to leave the base rate unchanged on Thursday and aren’t expected to make a move until next Spring.”

Global equity markets have surged higher on hopes of an interest rate cut by the Federal Reserve. With a deterioration in the jobs market, the Fed has little choice but to cut interest rates, and the question traders will be asking themselves is not whether they cut, but by how much.

Some investment banks have called for a 50 bps cut, but this seems unlikely with the consensus pointing to a quarter-point cut.

The Bank of England is not expected to cut rates, but they have surprised the market before.

FTSE 100 movers

Sainsbury’s was the FTSE 100’s top riser after the group said it had turned down an approach for its Argos business unit.

“The firing gun has effectively been triggered on the sale of Argos. Sainsbury’s might have rejected an offer from Chinese retailer JD, but the fact it hasn’t come out and said the business isn’t for sale at any price is telling,” said Dan Coatsworth, investment analyst at AJ Bell.

“Sainsbury’s has talked up a food-first strategy for some time, implying that Argos wasn’t core to its long-term plans. The general merchandise business hasn’t been doing that well for a few years, and it always felt like Argos concessions were hidden away in the corner rather than being a prominent part of a Sainsbury’s store.”

Sainsbury’s shares were 6% as investors positioned for the potential future sale of Argos, which would allow the group to focus efforts on what it does best.

AstraZeneca and BT were both down more than 3% and were the top fallers on the day.

Housebuilders were among the gains as investors hoped for positive commentary from the BoE on Thursday and looked past soft data from Rightmove on house prices.

“Despite Rightmove data showing the first drop in house prices since the start of last year, housebuilders’ shares proved resilient, Mould said.

“The sector will be hoping the recent easing in gilt yields – which have a big impact on the mortgage market – is sustained.”