London's FTSE 100 drops ahead of parliamentary elections

The blue-chip FTSE 100 was 0.5% lower, reaching its lowest level in over two weeks, while the mid-cap FTSE 250 dropped 0.3%

London's FTSE 100 dropped on Tuesday after closing the previous session flat as investors maintained caution ahead of the parliamentary elections at home, while a rise in oil prices contained declines.

The blue-chip FTSE 100 was 0.5% lower, reaching its lowest level in over two weeks, while the mid-cap FTSE 250 dropped 0.3%. Investors refrained from placing big bets ahead of the UK parliamentary elections on Thursday, where the Conservatives look set to be replaced after 14 years.

Meanwhile, prices in British shops increased at the slowest pace in nearly three years last month, according to industry figures that underscore how inflation has eased. The last key inflation figure showed that May inflation had dropped to the BoE's 2% target for the first time in almost three years. However, investors do not expect it to help Prime Minister Rishi Sunak's fortunes in the poll.

GSK slid 1.2% after a Delaware judge rebuffed a request by the drugmaker and others to appeal a ruling allowing over 70,000 lawsuits claiming that the heartburn drug Zantac caused cancer to go forward. Sainsbury's, Britain's second biggest supermarket group, slid 1.5% after it kept its annual financial guidance as it reported a 3% increase in first-quarter underlying sales.

The stock weighed on the personal care, drug and grocery sector that dropped 1.3%. Energy shares were the top gainers after oil prices held near two-month highs on expectations of growing fuel demand from the summer travel season and possible U.S. interest rate cuts.

Heavyweight oil giant BP added more than 1%. A job openings report is due in the US later in the day, alongside Fed Chair Jerome Powell's speech.