Stock prices in London closed mostly lower on Tuesday as expectations of a rate cut from the US Federal Reserve continue to dominate.

It follows the release of industrial and retail data in the US.

The Fed started its two-day key policy meeting on Tuesday, AFP reported, hours after Stephen Miran narrowly won confirmation to join the central bank.

Stephen Miran, who has been a key advisor to US President Donald Trump, took the oath of office as a Fed governor on Tuesday after narrowly winning a senate vote on Monday night to become one of the FOMC’s 12 voting members.

It remains to be seen if he will push for larger rate cuts as the US president has repeatedly demanded, with markets widely expecting a 25 basis points cut at the end of discussions on Wednesday.

The FTSE 100 index closed down 81.37 points, 0.9%, at 9,195.66.

The FTSE 250 ended down 154.72 points, 0.7%, at 21,491.87, and the AIM All-Share closed up 0.48 points, 0.1%, at 767.87.

“A barrage of US companies are expected to announce big investments in the UK to coincide with Donald Trump’s state visit,” said AJ Bell’s Russ Mould.

“Google-owner Alphabet is the latest name in the frame, with news it will spend £5 billion in the UK on AI-related infrastructure investments and scientific research… (but) the expected wave of US investment wasn’t enough to lift the UK stock market.

“The FTSE 100 gets more than two-thirds of its earnings from overseas, so even policies that can potentially boost growth domestically may not have the impact on the constituents of the UK’s leading stock market index that some might expect.”

Anglo American, on the FTSE 100, gained 0.6%.

The miner has formally completed its copper tie-up with the Chilean state-owned mining company Codelco.

It comes after the two companies back in February this year signed a memorandum of understanding for a framework to implement a joint mine plan for their adjacent copper mines of Los Bronces and Andina in Chile.

Student accommodation provider Unite Group lost 1.7%.

The UK Competition & Markets Authority has invited comments on Unite’s proposed acquisition of Empiric Student Property, in the first step ahead of a potential formal investigation into the deal.

Empiric, whose shareholders are set to own 10% of the combined firm if the deal goes ahead, was down 1.1% on the FTSE 250.

Also on the FTSE 250, Pollen Street Group closed 3.0% higher.

The London-based asset manager said it was encouraged by growing demand for mid-market alternatives and asset-based lending, as it announced first-half pre-tax profit growing 28% annually to £29.6 million while total income climbed 17% to £63.8 million.

Pollen Street also declared an interim dividend of 27.0 pence, up 1.9%.

Chief financial officer Crispin Goldsmith said the firm “is trading in line with expectations”, adding: “The group remains in a strong position and is strategically well placed and well resourced for further growth through H2 2025 and beyond.”

On AIM, Focusrite closed 15% higher.

The music and audio products hailed a “resilient performance” in the face of tough market conditions, with revenue rising to £87 million for the six months to August 31 and to £168 million for the 12 months.

Focusrite has changed its year-end to February 28 from the end of August.

It expects adjusted Ebitda for the 12 months to August to be within the market forecast range, which it puts at £24.5 million to £26.0 million.

Stocks in New York were lower.

The Dow Jones Industrial Average was down 0.4%, the S&P 500 index down 0.2%, and the Nasdaq Composite down 0.1%.

The yield on the US 10-year Treasury was quoted at 4.05%, widening from 4.04%.

The yield on the US 30-year Treasury was quoted at 4.66%, widening from 4.65%.

US industrial production rose 0.1% on-month in August after a downwardly revised fall of 0.4% in July, the Fed reported.

It outperformed the FXStreet-cited consensus of a 0.1% decline in August.

Also, according to the Census Bureau, US retail sales rose 0.6% in August from July, unchanged on-month but beating the FXStreet cited consensus of a 0.2% rise.

Separate data showed that the export price index rose 0.3% in August from July, though it had been expected to be flat.

The import price index advanced 0.3%, beating consensus of a 0.1% fall.

In other US news, Mr Trump said that the US and China had reached an agreement over TikTok, which Washington says must pass to US-controlled ownership.

“We have a deal on TikTok, I’ve reached a deal with China, I’m going to speak to President Xi on Friday to confirm everything up,” Mr Trump told reporters as he left the White House for a state visit to the UK.

“Neither side wants to be seen as weak, but there is also a desire to keep trade flowing between the two sides,” Mr Mould said.

“Progress on TikTok’s future in the US and US-China trade agreements more broadly have been slow, and they look set to drag on.

“Finding a middle ground that satisfies both the authorities in the US and China has proved to be difficult to achieve, which makes the prospect of a framework deal on TikTok’s US somewhat curious.

“More information is expected on Friday, and the structure of any potential agreement could provide hints to how future deals are struck more broadly between the US and China.”

In European equities on Tuesday, the CAC 40 in Paris closed down 1.0%, while the DAX 40 in Frankfurt ended down 1.8%.

German industrial major thyssenkrupp was up 4.9% in Frankfurt, after announcing that India’s Jindal Steel International has made a “non-binding, indicative offer” for its steel business Thyssenkrupp Steel Europe.

Thyssenkrupp, which has been looking to split itself into standalone businesses to boost profitability, would “carefully review” the offer and pay “particular attention” to what it would mean for employment at its sites, it added.

The pound was quoted higher at 1.3642 dollars at the time of the London equities close on Tuesday, compared to 1.3597 dollars on Monday.

The euro stood higher at 1.1837 dollars, against 1.1765 dollars.

Against the yen, the dollar was trading lower at 146.65 yen compared to 147.34 yen.

Brent oil was quoted higher at 68.32 dollars a barrel at the time of the London equities close on Tuesday, from 67.37 dollars late on Monday.

Gold was quoted higher at 3,680.32 dollars an ounce against 3,668.27 dollars.

The biggest risers on the FTSE 100 were Fresnillo, up 92.6p at 2,288.6p, J Sainsbury, up 5.0p at 322.8p, Croda International, up 39.0p at 2,556.0p, Glencore, up 3.7p at 310.55p, and Mondi, up 11.1p at 1,007.5p.

The biggest fallers on the FTSE 100 were Haleon, down 17.0p at 339.7p, easyJet, down 15.8p at 457.2p, Barclays, down 9.8p at 374.85p, Coca-Cola HBC, down 92.0p at 3,598.0p, and NatWest, down 13.4p at 524.4p.

On Tuesday’s economic calendar, as well as the Fed rate decision and press conference, look out for UK and eurozone consumer inflation.

On Tuesday’s UK corporate calendar, Barratt Developments releases full-year results; IP Group has half-year results; and Games Workshop holds its annual general meeting.

– Contributed by Alliance News