UK's FTSE 100 retreats from record high; Mondi slumps after results

By Purvi Agarwal

(Reuters) -London's benchmark FTSE 100 closed lower on Monday as investors took a breather after last week's record peak and sold shares of packaging company Mondi after its disappointing results.

The blue-chip index briefly crossed 9,500 for the first time on Monday, its fifth consecutive session of record highs, before reversing course. It closed down 0.13% at 9,479.14 points.

The mid-cap FTSE 250 shed 0.44% after logging its biggest weekly gain in two months on Friday.

Mondi shares slumped 16% to a nearly 11-year low after the company said growth in its third-quarter core profit slowed on weak demand and lower prices. 

Investors across the UK and European Union were also spooked by the unexpected resignation of France's new prime minister Sebastian Lecornu and his government on Monday, hours after he announced his cabinet line-up. This made the government the shortest-lived in modern French history. 

British banks lost 0.5%.

"The fact that the French Prime Minister has resigned adds to concerns around political and fiscal stability and more broadly in the UK and Europe," said Fiona Cincotta, senior market analyst at City Index.

"We often see the nerves surrounding the fiscal outlook reflected in banking stocks."

Meanwhile, Citigroup double downgraded UK equities to "underweight" from "overweight". It said the market's exposure to defensive sectors such as consumer staples and utilities made it less attractive in an environment increasingly favouring cyclical and growth-oriented plays.

On the flip side, precious metal miners rose nearly 2% after gold surged to an all-time high above $3,900 per ounce. [GOL/]

Energy stocks gained 1.5%, tracking a rise in crude prices. [O/R]

The healthcare sector, which had boosted the FTSE 100 last week by logging its best weekly performance since October 2008, was nearly flat on the day. Investor interest in the beaten-down sector rebounded after a U.S.-Pfizer deal to lower prescription drug prices in the Medicaid program reduced industry uncertainty.

Aston Martin shares declined 10.1%, weighing heavily on the FTSE 250, after the luxury carmaker warned of a deepening annual loss due to weaker-than-expected demand in North America and Asia Pacific and the impact of U.S. tariffs.

(Reporting by Sanchayaita Roy and Purvi Agarwal in Bengaluru; Editing by Leroy Leo and Richard Chang)