London's FTSE 100 drops to one-month low; Morrisons surges

London's FTSE 100 index fell to its lowest level in a month on Monday, led by weakness in heavyweight mining and travel stocks, with investors weighing inflation concerns ahead of economic data and Bank of England's rate decision later in the week.

London's FTSE 100 index fell to its lowest level in a month on Monday, led by weakness in heavyweight mining and travel stocks, with investors weighing inflation concerns ahead of economic data and Bank of England's rate decision later in the week. The blue-chip index dropped 0.8% to its lowest since May 19. Travel stocks fell the most, down nearly 7.5%, while miners declined 1.7%.

Data last week showed Britain's inflation surged past its central bank's target in May, compared with the previous year, raising concerns that the Bank of England could pull back its monetary support later this week. Britain's top central bank officials look set to remain divided this week over whether to pull the plug on their 875 billion-pound ($1.2 trillion) government bond purchase programme.

The domestically focussed mid-cap index fell 0.5% Among stocks, supermarket chain Morrisons surged 29.8% as U.S. private equity firm Clayton, Dubilier & Rice (CD&R) is set to push ahead with its takeover pursuit.

Outsourcer Capita gained 0.4% after it said it was on track to post revenue growth for the first time in six years and agreed to sell its 51% stake in Axelos, a joint venture with the UK Cabinet Office.

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