LONDON, Aug 31 ― London's FTSE 100 slipped yesterday from this week's 11-month high, as wealth manager St James's Place, homebuilder Taylor Wimpey and mortgage lender Lloyds fell on the back of results, overshadowing an upbeat forecast from clothing retailer Next.

The main index lost 0.8 per cent, its biggest one-day drop in two months, as exporter stocks also weighed after the pound recovered from a 28-month low.

The mid-cap FTSE 250 fell 0.6 per cent with losses led by mall operator Intu and carmaker Aston Martin following results.

The indexes underperformed their European and US counterparts, which were supported by strong earnings readings from lenders BNP Paribas and Credit Suisse, as well as tech giant Apple, ahead of a much-awaited US Federal Reserve interest rate decision.

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Wealth manager St James's Place fell 5.6 per cent on its worst day in more than three years after it missed forecasts for operating profit, as weaker client sentiment weighed on inflows of new money in the first half of the year.

Housebuilders, already under pressure due to heightened worries about a no-deal Brexit under new Prime Minister Boris Johnson, skidded nearly 2 per cent after Taylor Wimpey forecast a fall in annual margins. Taylor Wimpey shares slumped 8.4 per cent.

Lloyds Banking Group, Britain's biggest mortgage lender, slipped 3.1 per cent after a further charge to meet claims for mis-sold insurance to consumers hit its earnings.

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“The picture for Q2 was always likely to be much more tricky given that the UK economy slowed quite significantly during April and May, in the wake of the extension of the Brexit deadline at the end of March,” CMC Markets analyst Michael Hewson wrote.

Despite the session's losses, the blue-chip index is set to post its second straight month of gains, mainly due to hopes among investors that the US Federal Reserve and other central banks will cut interest rates.

“We also have to wonder just how much the Fed can deliver for the market now that so much is already expected of it,” Markets.com analyst Neil Wilson said.

The Fed is widely expected to pull the trigger on a 25 basis points rate cut later yesterday with future sentiment heavily relying on whether the central bank of the world's biggest economy hints at any future policy easing.

The FTSE 100's losses were kept in check by retailer Next , which jumped 8 per cent to a more than one-year high after it raised its full-year sales and profit targets.

Among midcaps, Intu, whose shares have plummeted this year as it scrapped its dividend and changed management in the wake of failed takeover bids, lost nearly one third of its value after reporting a fall in first-half net rental income. The stock closed at a record low.

Aston Martin, whose shares debuted on the London markets last year, plunged 12.3 per cent after posting a half-year loss. ― Reuters