FTSE 100 today: Index falls, pound tops $1.37, defense stocks gain

Investing.com – British pound held above $1.37 on Monday after crossing the level last week, as data confirmed the UK economy grew in the first quarter of 2025.

The blue-chip index FTSE 100 fell 0.4% and the British pound was flat against the dollar at above 1.37. 

DAX index in Germany gained 0.2%, the CAC 40 in France dropped 0.05%.  

Defense stocks rise as U.K.-U.S. trade deal takes effect

Defense stocks rose as the U.K.-U.S. trade deal officially came into effect, boosting investor sentiment.

Rolls-Royce (LON:RR) led the sector’s gains, climbing 1.4%, while Chemring (LON:CHG), Qinetiq (LON:QQ), and BAE Systems (LON:BAES) also posted modest increases.

Although the agreement includes favorable tariffs for U.K. car exports, uncertainty lingers over how British metal shipments will be treated.

UK regulator opens formal probe into Boeing–Spirit deal

U.K. competition authorities have opened a formal review into Boeing’s proposed $4.7 billion acquisition of Spirit AeroSystems (NYSE:SPR), a move that could stall or jeopardize the deal.

The Competition and Markets Authority (CMA) is examining whether the takeover could negatively impact competition in the U.K. or globally.

A decision on whether to proceed with a deeper investigation is anticipated by August 28.

WH Smith (LON:SMWH) shares fall after revising U.K. High Street sale terms

WH Smith shares fell more than 3% Monday after the retailer revised the financial terms of its planned sale of the U.K. High Street business to Modella.

The company lowered the expected proceeds from £52 million to a potential maximum of £40 million. WH Smith said it completed the transaction with an upfront payment of £10 million.

The retailer could receive up to £30 million in additional proceeds through August 2026, with the exact amount dependent on business performance and asset realization.

U.K. economy rebounds in Q1

The U.K. economy returned to growth in the first quarter of 2025, according to final GDP figures released Monday, though challenges may still loom.

The Office for National Statistics reported that the country’s gross domestic product expanded by 0.7% quarter-on-quarter in the first three months of the year, marking a 1.3% increase compared to the same period in 2024.

U.S.-U.K. trade deal takes effect

The trade agreement between the United States and Britain that reduces certain tariffs on British imports has officially taken effect, the British government announced Monday.

The deal, signed by U.S. President Donald Trump and British Prime Minister Keir Starmer, marks a significant development in transatlantic trade relations.

U.K. regulator plans to simplify investment rules 

In separate regulatory news, Britain’s financial regulator revealed Monday plans to simplify rules for investment firms providing pension and investment support to customers.

The financial industry has broadly welcomed this change, having previously criticized the existing strict regulations.

U.K. regulator launches probe into Wood Group 

In other British corporate developments, oilfield services provider Wood Group disclosed Friday that Britain’s financial watchdog has initiated an investigation into the company.

This follows Wood Group’s announcement last year regarding an independent accounting review related to certain contracts and charges.