UPDATE 1-BP pulls down UK bluechips as Brexit uncertainties mount

London's stock markets weakened on Tuesday as the prospect of a Brexit 'flextension' and parliament rejecting Prime Minister Boris Johnson's demand for an election before Christmas kept investors guessing and wary of taking more risk. The FTSE 100 was 0.4% lower by 0849 GMT, pulling back from a near one-month high in the previous session. The mid-cap FTSE 250 was down 0.3%.

Oil major BP weighed the most on the main bourse, dropping 1.1% after posting a sharp drop in third-quarter profit on the back of weaker oil prices and lower production. At home, the European Union agreed to a Brexit delay of up to three months on Monday, but a lot remains unclear as lawmakers argue over how, when or even if the UK should leave the bloc.

Aggravating matters, Johnson has said he would try again to force a general election. Investors are also on tenterhooks for the U.S. Federal Reserve meeting to conclude this week, in which the central bank is expected to cut interest rates for the third time this year to boost a slowing economy amid an ongoing trade war with China.

"We expect a pickup in global growth in the next six to 12 months, yet see limits to how much monetary easing can be delivered in the near term," BlackRock analysts said. "Monetary policy is no cure for the weaker growth and firmer inflation pressures that may result from sustained trade tensions."

Financial companies, whose margins would be under pressure in a low-interest rate scenario, were the biggest sector-wise drags on the FTSE 100 by 0847 GMT. The sub-index tumbled 1% to its lowest level in two weeks.

Mid-cap constituent Hunting fell 4% as the oilfield services company issued a warning on profits as it struggles with a slowdown in the U.S. onshore drilling market. Royal Mail skidded 5.3% - its steepest one-day drop in three months - after JP Morgan cut its rating on the stock to 'underweight' from 'neutral'.

Online trading platform Plus500 jumped 6.3% after reporting a rise in customer additions and revenue for the third quarter as macro events drove strong trading. The wider sentiment also turned sour after news that the United States Trade Representative was studying whether to extend tariff suspensions on $34 billion of Chinese goods set to expire on Dec. 28.

That, coming after U.S. President Donald Trump said he expected to sign a significant part of a trade deal with China ahead of schedule, sent mixed signals to markets.

Also Read: Boris Johnson in race against time to strike Brexit deal

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)