The surprisingly robust US jobs data lowered expectations of a Fed rate cut this year. On Friday, the FTSE 100 closed 0.2% lower, and was flat for the week.

London stocks opened lower on Monday, with the FTSE 100 down 0.5%. Investors are cautious ahead of key domestic economic data releases, including wages and GDP figures, expected later this week. The Bank of England is also set to meet in less than two weeks to decide on borrowing costs, with analysts predicting it may cut rates independently of the US Federal Reserve.

All eyes are on the US Federal Reserve, which is expected to leave interest rates unchanged at its fourth meeting of 2024, scheduled for Wednesday. This follows recent rate cuts by the Bank of Canada and the European Central Bank, both of which reduced rates by 25 basis points. ECB President Christine Lagarde emphasized that inflation control remains a long-term goal, despite recent progress.

Political uncertainty in Europe is also affecting market sentiment. Far-right parties made significant gains in the EU elections, with French President Emmanuel Macron's liberal party suffering a major defeat to Marine Le Pen's National Rally. Macron responded by dissolving France's national parliament and calling for snap elections.

In other news, fast-fashion retailer Shein is unlikely to meet the qualifications for inclusion in the FTSE 100 index. The company's initial public offering (IPO) on the London Stock Exchange is expected to fall short of the minimum size requirement. The IPO is not anticipated to occur until after the summer holidays in August.

Meanwhile, the US Food and Drug Administration (FDA) approved the expanded use of GSK's respiratory syncytial virus (RSV) vaccine for adults aged 50-59 who are at increased risk, and granted priority review for AstraZeneca's supplemental new drug application for Tagrisso, aimed at treating non-small cell lung cancer.

ME Group International reported a 4.6% increase in revenue and a 10% rise in pretax profit for the six months ending April 30. The company expects record profitability for the year.

Chemring signed a 15-year agreement with Northrop Grumman for the supply of HMX energetic material, valued at USD 83 million.