By Khushi Singh and Shubham Batra
(Reuters) -The UK's FTSE 100 fell on Monday, hurt by a sell-off in luxury and bank stocks, while lacklustre corporate earnings forecasts weighed on the FTSE 250 shares.
The blue-chip FTSE 100 slid 0.4%, while the midcap FTSE 250 index was flat at the close.
Personal goods index fell 4.4%, with Burberry extending losses with a 5.7% slump, after three brokerages cut the target price on the luxury retailer after it warned of a worsening slowdown in demand for luxury goods last week.
"Today's biggest fallers on the FTSE100 are lower due to broker downgrades. Burberry shares have continued their recent slide after getting downgraded by Goldman Sachs (NYSE:GS) to neutral on concern over further weakness in its margins," said Michael Hewson, chief market analyst at CMC Markets UK.
Top performer non-life insurers gained 1.3%, while banks fell 1.8%, logging five straight days of losses.
Lender HSBC (LON:HSBA) lost 2.2% after Exane downgraded the stock, citing margin headwinds.
Investors are awaiting British consumer price inflation data and retail sales figures for December, both of which are due later this week, for more clarity on the timing of expected interest rate cuts.
The Bank of England seems to be a relatively hawkish outlier compared to the Federal Reserve and the European Central Bank as they have stuck to their higher-for-longer policy rhetoric.
Across the Atlantic, investors will closely monitor U.S. business activity data for January and December retail sales.
Shares of PageGroup fell 0.3% after the global recruiter trimmed its annual profit forecast.
Crest Nicholson (LON:CRST) was down 0.8% after the homebuilder cut its annual profit forecast.
Meanwhile, average asking prices for British homes made the strongest start to the year since 2020, according to an industry survey that suggested the slowdown in the sector could be easing.