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FTSE 100 down 0.1%, FTSE 250 up 0.2%

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UK budget announcement on Wednesday

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Defence sector, consumer staples stocks fall

(Updates after market close)

Nov 24 (Reuters) - London's FTSE 100 edged lower on

Monday, as consumer staples and industrials stocks weighed,

while investors awaited the British government's highly

anticipated budget this week.

The blue-chip index closed down 0.1%, while the

mid-cap FTSE 250 added 0.2%, bouncing from its longest

losing streak in more than two years.

Aerospace and defence stocks fell 1.7% as

peace talks to end the war in Ukraine progressed. BAE Systems

fell 3.6%, while Babcock International ( BCKIF ) lost

1.6%.

Beverage stocks declined 1.8%, with Diageo ( DEO )

down 2.2%. The personal care, drug and grocery sub-index

fell 1.2%, with Marks & Spencer ( MAKSF ) falling

2.6%. Utilities lost 1.3%.

On the flip side, banking stocks rose 1%.

Morgan Stanley analysts estimated net interest income growth of

4% next year for European banks.

Standard Chartered ( SCBFF ) climbed 2.9% after the analysts

upgraded the lender to "overweight". Barclays ( BCS ) added

2.1% after Morgan Stanley named it a top pick.

Precious metal miners rose 5.9% as gold

prices climbed on stronger Fed rate-cut bets. Fresnillo

surged 9.1%, while Endeavour Mining ( EDVMF ) gained 4%.

Homebuilders' stocks advanced after Goldman Sachs

initiated coverage with a "constructive outlook". Vistry

rose 3.8%.

Travel and leisure stocks advanced 1.7%, with

EasyJet ( EJTTF ) up 3.6%.

The mid-cap index has shed around 5% from its October peak

amid global market weakness and budget uncertainty.

Finance minister Rachel Reeves looks set to raise taxes by

tens of billions of pounds for the second time since the 2024

election to meet her borrowing targets, hoping to avoid a bond

market selloff while also increasing welfare spending.

She is unlikely to break an election promise by raising

income tax and will resort instead to increases in a range of

other taxes.

Meanwhile, global stocks climbed after comments from a U.S.

Federal Reserve official last week boosted expectations for a

December rate cut. The gains followed a sharp pullback in equity

markets on concerns over elevated valuations in AI stocks.

Anglo American gained 0.9% after global miner BHP

abandoned a last-ditch effort to buy its rival.