London's FTSE 100 nudges higher on rate optimism

By Purvi Agarwal and Shubham Batra

(Reuters) -Britain's FTSE 100 closed slightly higher on Monday, boosted by real estate shares on optimism around interest rate cuts in the U.S. and the UK, while Reckitt Benckiser shares hit their lowest in over a decade following a ruling against competitor Abbott.

The blue-chip FTSE 100 index was up 0.1%, hitting its highest since early June. The mid-cap FTSE 250 was down 0.5% after closing at its highest level in more than two years on Friday.

All eyes will on the U.S. Federal Reserve on Wednesday and Bank of England on Thursday for their interest rate decisions. Money markets see a 59% chance that the BoE will cut rates by 25 basis points next week.

The Fed, on the other hand, is expected to keep rates unchanged on July 31 and begin easing monetary policy from September.

Shares of British consumer goods company Reckitt Benckiser hit their lowest in over 11 years, down 8.8%, after a U.S. jury found Abbott Laboratories' premature infant formula caused a baby to develop a dangerous bowel disease.

Close to 1,000 lawsuits have been filed against Enfamil formula maker Reckitt Benckiser, Abbott or both in federal or state courts.

Rate-sensitive real estate shares boosted the benchmark index with a 0.9% gain, while pharma and biotech shares also rose nearly 1%.

Precious metal miners and industrial metal miners fell 0.8% and 1.3%, respectively, tracking losses in prices of gold and copper. [GOL/] [MET/L]

A crucial jobs report from the U.S. is due on Friday, which could further influence the Fed's stance while Big Tech companies Microsoft, Apple, Amazon.com and Meta are also set to report their quarterly earnings this week.

Education company Pearson fell 0.6% despite reporting a 4% rise in first-half adjusted operating profit.

(Reporting by Purvi Agarwal in Bengaluru; Editing by Savio D'Souza and Christina Fincher)