FTSE 100 Dips Amid US Tariff Tensions and Travel Sector Slump

The FTSE 100 index closed at its lowest in nearly two months, impacted by declining travel and leisure stocks and new U.S. tariff threats. IAG shares fell following Delta's weak outlook, and Domino's Pizza experienced volatile trading. Meanwhile, Persimmon rose due to plans for increased home building.

Amid heightened concerns over U.S. tariffs and sluggish performance in travel stocks, the FTSE 100 closed at its lowest level in nearly two months on Tuesday. The index shed 1.2%, marking six consecutive sessions of decline, with travel and leisure industries leading the downturn.

The drop in the travel sector was mainly influenced by British Airways parent company IAG, which fell 6.1% after Delta Air Lines reported a challenging market environment driven by U.S. economic uncertainty. Meanwhile, the homebuilding sector offered a bright spot, with Persimmon recording a 5.5% increase after affirming plans to accelerate home construction benefits supported by interest rate cuts.

In response to U.S. President Donald Trump doubling tariffs on imports from Canada, market volatility surged. The British government announced it would not impose retaliatory tariffs despite the new U.S. duties. Simultaneously, the midcap FTSE 250 also saw declines, while Rotork Plc shares rose following a strategic acquisition announcement.

(With inputs from agencies.)