Sharecast - By 0835 in London, the FTSE 100 was down 0.3% at 7,504.04.
Stocks in Asia fell sharply overnight on the back of renewed concerns about China's property sector. Hong Kong's Hang Seng Index slumped 1.8% after Chinese developer Country Garden announced it was suspending the trading of 11 onshore bonds. The news follows a warning last week from the company that it expects to lose $7.6bn in the first half of 2023.
In the US, data on Friday showed that producer price inflation unexpectedly picked up last month – a cause for concern for economists who had hoped that a possible slowdown in price growth may prompt the Federal Reserve to pause hiking interest rates at its next meeting.
However, Goldman Sachs (NYSE:GS) predicted over the weekend that the Fed is unlikely to hike rates again this year. In fact, the bank reckons that the first rate cut will take place in the second quarter of 2023.
No major economic data is scheduled for release on Monday. Eyes are now turning to UK consumer price inflation figures due out on Wednesday, which are expected to show that annual price growth softened from 7.9% to 6.7% in July, with prices falling 0.5% month-on-month.
Commodity stocks provide a drag
Mining stocks were the morning's worst performers, with Rio Tinto (LON:RIO), Anglo American (LON:AAL) and Antofagasta (LON:ANTO) providing a drag on the FTSE 100 early on, as sentiment was dampened by newsflow out of China. Oil peers Shell (LON:RDSa) and BP (LON:BP) were also lower.
Retailers Frasers Group, JD Sports Fashion and B&M European Value Retail were among the best performers.
Plus500 (LON:PLUSP) gained after announcing $120m of shareholder returns through a first-half dividend and new share buyback programme. The contract-for-difference platform also said that, despite "quieter market conditions", it expects 2023 results to be in line with current forecasts.
Shares in precious metals explorer and miner Hochschild Mining (LON:HOCM) jumped after the company gave positive updates on its Volcan Gold Project in Chile. Chief executive officer Ignacio Bustamante said updated estimates confirm that Volcan "is a large resource capable of generating significant annual gold production with substantial margins at today's gold prices".
Shaftesbury Capital gained after announcing a new 10-year loan of £200m from Aviva (LON:AV) Investors.
Domain registry and internet services provider CentralNic rose after giving an upbeat outlook as it delivered an impressive set of first-half results, with revenues rising by nearly a fifth.
Market Movers
FTSE 100 (UKX) 7,504.04 -0.27%
FTSE 250 (MCX) 18,775.51 -0.13%
techMARK (TASX) 4,347.63 0.00%
FTSE 100 - Risers
Pershing Square (NYSE:SQ) Holdings Ltd NPV (PSH) 3,020.00p 1.68%
B&M European Value Retail S.A. (DI) (BME) 546.20p 1.56%
GSK (GSK) 1,385.80p 1.08%
Beazley (BEZ) 543.00p 1.02%
JD Sports Fashion (JD.) 144.70p 0.98%
Whitbread (LON:WTB) 3,522.00p 0.66%
Smurfit Kappa Group (CDI) (SKG) 3,146.00p 0.64%
InterContinental Hotels Group (IHG (LON:IHG)) 5,986.00p 0.61%
Frasers Group (FRAS) 803.50p 0.56%
Admiral Group (LON:ADML) (ADM) 2,216.00p 0.41%
FTSE 100 - Fallers
Rio Tinto (RIO) 4,651.50p -1.58%
BP (BP.) 480.40p -1.23%
Anglo American (AAL) 2,125.00p -1.21%
Standard Chartered (LON:STAN) 746.40p -1.14%
Persimmon (LON:PSN) 1,117.00p -1.11%
Entain (LON:ENT) 1,298.50p -1.07%
Shell (SHEL) 2,390.50p -1.06%
Burberry Group (LON:BRBY) 2,230.00p -0.98%
Glencore (LON:GLEN) 440.65p -0.91%
Ocado Group (LON:OCDO) 825.00p -0.87%
FTSE 250 - Risers
CMC Markets (CMCX) 133.40p 3.73%
Plus500 Ltd (DI) (PLUS) 1,477.00p 3.21%
Ashmore Group (ASHM) 205.40p 3.06%
Bodycote (BOY) 728.50p 2.75%
Grainger (GRI) 250.40p 2.37%
Watches of Switzerland Group (WOSG) 715.00p 2.14%
Ninety One (N91) 175.70p 1.68%
Mitchells & Butlers (MAB) 233.20p 1.66%
Quilter (QLT) 82.95p 1.65%
JPMorgan (NYSE:JPM) Indian Investment Trust (JII) 842.00p 1.45%
FTSE 250 - Fallers
W.A.G Payment Solutions (WPS) 90.00p -6.25%
Vistry Group (LON:VTYV) (VTY) 769.50p -1.85%
Ibstock (IBST) 154.00p -1.66%
Jupiter Fund Management (JUP) 102.10p -1.64%
Wood Group (John) (WG.) 162.90p -1.63%
Fidelity China Special Situations (LON:FCSS) 215.00p -1.60%
Vanquis Banking Group 20 (VANQ) 113.00p -1.57%
Derwent London (DLN) 2,008.00p -1.47%
Babcock International Group (LON:BAB) 383.80p -1.44%
Capita (CPI) 20.60p -1.44%