(Updates with market closing prices)

* Energy stocks outperform peers in July

* NatWest ( NWG ) gains after 2026 performance outlook raise

* IG slides after $1.3 bln deal for prediction markets

operator Underdog

July 31 (Reuters) - London's FTSE 100 dipped from record

highs on Friday, but registered weekly and monthly gains as

robust earnings buoyed markets through a week of central bank

decisions and Middle East hostilities.

The blue-chip FTSE 100 index, which closed down 0.3%

at 10,868.05 points, marked its biggest monthly jump since

February. The midcap FTSE 250 dipped 0.4% on the day and

notched a third week of gains in a row.

* Heavyweight energy stocks added 1.9% as

Brent crude prices climbed above $90 a barrel. The

sector has gained over 15% in July, outperforming its peers, as

U.S.-Iran hostilities escalated, threatening fuel supplies.

* Meanwhile, British finance minister John Healey said he

will hold his first budget on October 28 and pledged to stick to

the borrowing rules he inherited from his predecessor Rachel

Reeves.

* Economists say the government has only a small margin of

error for hitting that target and some of Prime Minister Andy

Burnham's policy priorities - such as extra defence spending and

better social care - will put more strain on the public

finances.

* The Bank of England held interest rates on Thursday, but

the number of dissenters was three compared with expectations of

two, as the impact of the Iran conflict on the economy worried

policymakers.

* Corporate earnings were in full swing, with investor

attention split between reports and macro factors.

* NatWest ( NWG ) gained 3.2% after the lender reported a

better-than-expected first-half operating profit before tax of

£4.3 billion ($5.8 billion) and raised its outlook for the year.

* British Airways owner IAG dipped 1.5% after the

company trimmed its 2026 capacity outlook to flat.

* IG Group ( IGGRF ) slipped 1.5% to the bottom of the FTSE

100 after it agreed to acquire U.S. daily fantasy sports and

prediction markets operator Underdog for up to $1.3 billion.

* Sainsbury's ( JSNSF ) inched up 1% after the supermarket

chain agreed to sell Argos for at least £120 million ($161

million), exiting the general retail business.

* Greggs ( GGGSF ) shed 7.5% to end at the bottom of the FTSE

250 after RBC downgraded the fast-food chain's stock to "sector

perform" from "outperform".