FTSE 100 edges higher as markets await Fed decision under new chairman Kevin Warsh

London stocks finished trading slightly higher on June 17, 2026, with the FTSE 100 up 14 points to 10,508 as investors navigated uncertainty ahead of the Federal Reserve's first monetary policy decision under new chairman Kevin Warsh. UK inflation remained stable at 2.8%, while the pound weakened on expectations that the Bank of England would hold rates steady.

Market sentiment was tempered by conflicting signals from Warsh's policy stance. While his preference for lower interest rates typically appeals to equity investors, his emphasis on reducing the Fed's balance sheet created caution in markets. "A new chief means markets face a degree of uncertainty for US monetary policy, and as a result the rally from last week continues to cool," said Chris Beauchamp, chief market analyst at IG. He noted that hopes for falling energy prices following a potential US-Iran deal provided some support, though anticipation remained high ahead of the Fed announcement.

On Wall Street, mixed performance reflected broader tech sector volatility. The Dow Jones reached a new all-time high, up 193 points to 52,193, led by gains in Caterpillar, Goldman Sachs, and JPMorgan. However, the Nasdaq showed weakness, with major technology stocks including Alphabet, Microsoft, Amazon, and Meta all declining over 1%. SpaceX initially rallied 5% above $212 before reversing into negative territory.

In London, banking stocks provided the main support to the index, with Barclays up 2.5% and gains across Standard Chartered, Lloyds, NatWest, and HSBC. The resources sector remained under pressure, with Rio Tinto and Glencore among the biggest fallers, while consumer-facing names struggled, including a 3.4% drop for Marks & Spencer.

Meanwhile, political controversy emerged as British American Tobacco's US arm was reported to have donated $18 million to Trump-supporting Maga Inc, with the donation occurring before regulatory changes on flavoured vapes and nicotine pouches were eased. At the G7 Summit, Trump expressed cautious optimism about concluding an Iran deal, stating Iran's leadership "want to make a deal" but adding "you never know with deals." Oil prices rebounded during the session, with Brent crude rising above $80 per barrel.