FTSE 100 drops amid China banking concerns and falling oil prices

The UK's benchmark FTSE 100 index fell to its lowest level in more than two weeks on Thursday, weighed down by sharp declines in Asia-focused lenders and miners after reports of tighter offshore banking restrictions in China.

Lower crude oil prices also dragged energy stocks lower, adding to the market's weakness.

By 1144 GMT, the blue-chip FTSE 100 index had fallen 0.5% to 10,281.65 points, marking its lowest level since mid-May.

The mid-cap FTSE 250 index was also lower, edging down 0.1%.

China-exposed financial stocks lead declines

Shares of lenders with significant exposure to Asia came under pressure following a media report that mainland Chinese residents were facing increased restrictions when attempting to open offshore accounts at major Hong Kong banks.

HSBC fell 4.8%, while Standard Chartered declined 6.4%, making them among the biggest fallers on the FTSE 100.

The weakness extended beyond the banking sector. Asia-focused insurer Prudential dropped 6.7% and was on track for its largest single-day decline since February.

The report raised concerns about potential impacts on financial activity linked to Chinese customers, prompting investors to reduce exposure to companies heavily reliant on Asian markets.

Mining stocks track metals weakness

Industrial metal miners also weighed on the London market as base metal prices initially moved lower.

Shares of Antofagasta and Rio Tinto each declined about 3%, reflecting investor concerns over demand prospects and broader sentiment toward commodity-linked stocks.

The mining sector's losses added further downward pressure on the FTSE 100, contributing to the benchmark index's slide to a multi-week low.

S4 Capital falls after chairman's remarks

Advertising group S4 Capital was among the sharpest individual stock movers, falling 8.7%.

The decline followed comments from Chairman Martin Sorrell, who said progress in improving revenue growth and margins had been insufficient.

According to Sorrell, the industry continues to face a marketing downturn driven by global macroeconomic uncertainty.

His remarks highlighted ongoing challenges for the advertising sector as businesses remain cautious about spending amid an uncertain economic backdrop.

CMC markets surge on profit forecast

In contrast to the broader market weakness, CMC Markets rose 15.8%.

The trading platform gained after forecasting annual profit ahead of market expectations, providing a boost to investor sentiment and making it one of the strongest performers of the session.

Energy shares retreat as oil prices slide

Energy stocks also came under pressure after crude oil prices fell by more than 3%.

The decline in oil prices followed news that Israel and Lebanon had agreed to implement a new ceasefire after US-mediated talks, according to the Trump administration.

The development raised hopes for progress toward ending the broader US-Israeli conflict with Iran.

As oil prices moved lower, shares of UK energy majors Shell and BP each fell more than 1%.

Construction activity weakens

Economic data released during the session added to concerns about the UK outlook.

Activity in Britain's construction sector slowed at its sharpest pace in six years during the previous month.

The slowdown was attributed to economic uncertainty and rising inflation linked to the Iran conflict, which contributed to a significant decline in new work across the sector.

The data underscored the challenges facing parts of the British economy, adding another layer of caution for investors already navigating global geopolitical and economic uncertainties.