Stocks in London closed mixed on Monday, with housebuilders the clear winners after the UK government unveiled a new equity loan programme for first-time buyers.

In London, the FTSE 100 index ended down 10.37 points, or 0.1%, at 10,684.88. The FTSE 250 rose 74.18 points, 0.3%, to 24,335.32, and the AIM all-share fell 3.00 points, 0.4%, at 783.36.

Housebuilders dominated the risers’ list on London’s stock market. On the FTSE 100, Barratt Redrow jumped 12%, while on the FTSE 250, MJ Gleeson, Persimmon, Bellway and Taylor Wimpey rose 20%, 15%, 10% and 12% respectively.

Stocks likely to benefit from a strong housing market rallied, with kitchen supplier Howden Joinery up 3.0% and home improvement retailer Kingfisher up 1.3%. Mortgage Advice Bureau rose 5.1%.

The stellar gains came after the UK government’s announcement on Saturday of Your First Home, a programme for England that will allow eligible first-time buyers to purchase a new-build property with a deposit of as little as 2.5%, alongside a government-backed equity loan worth up to 20% of the purchase price.

Further details, including costs and implementation timelines, are expected when Chancellor John Healey presents the UK government budget on October 28.

RBC Capital Markets analyst Anthony Codling said: “We believe this is the big catalyst the sector as a whole needed for a re-rating, and whilst most of us have 88 sleeps to Christmas, Christmas has come early for the UK housebuilders.”

In European equities on Monday, the CAC 40 in Paris ended up slightly, while the DAX 40 in Frankfurt closed down 0.1%.

It was a different picture on Wall Street. In New York, the Dow Jones Industrial Average was down 0.7% at the time of the closing bell in London. The S&P 500 was 0.8% lower, and the Nasdaq Composite declined 1.0%.

Bucking the weaker market, Nvidia rose 2.2% after it authorised an increase in its current run of buybacks, which are due to be completed in 2028.

The California-based chipmaker has increased its share repurchase scheme by 150 billion dollars (£113 billion), boosting the programme’s total value to 235 billion dollars (£177 billion).

“This marks the largest share repurchase authorisation increase in history,” Nvidia noted.

Elsewhere, oil prices remained elevated after US President Donald Trump rejected Iran’s offer of a seven-day truce.

Instead, the Wall Street Journal reported over the weekend that Mr Trump told aides that he expects to resume bombing Iran after November’s midterm elections.

Complicating the picture further, Mr Trump told Axios that US negotiators could be involved in further talks this week.

Brent oil was quoted at 107.60 dollars a barrel in London on Monday at the time of the equity market close, up from 106.21 dollars late on Friday.

Back in the UK, John Healey said the Government plans to bring back hope through a “new age of industrialisation”.

With a month to go until he delivers his budget, the Chancellor pledged to stick to the fiscal rules, adding that he hopes to “build a more resilient country” than the one left by the Conservatives.

Mr Healey announced £6 billion of new contracts for British shipyards, and said Rolls-Royce will invest £300 million in British factories in Derby, Bristol, Glasgow and Rotherham, in what he described as a “new age of industrialisation”.

The pound was quoted at 1.3256 dollars on Monday, up from 1.3238 dollars at the same time on Friday. Against the euro, sterling firmed to 1.1658 euros from 1.1616 euros.

The euro fell to 1.1370 dollars from 1.1396 dollars. Against the yen, the dollar was trading at 157.44 yen, up from 157.36 yen.

The yield on the US 10-year Treasury was quoted at 5.26%, stretched from 5.21%. The yield on the US 30-year Treasury was quoted at 5.57%, widened from 5.52%.

On the FTSE 100, mining stocks fell back sharply amid lower metal prices.

Fresnillo fell 5.1%, and Endeavour Mining shed 4.5%. On the FTSE 250, Hochschild Mining ebbed 7.2%.

“The dollar is enjoying a tailwind from the prospect of higher US interest rates and this looks unlikely to fade in the near term,” he said.

“The CME’s FedWatch Tool now shows a 94% probability of at least one 25-basis point rate hike before year-end. At the same time, the dollar is the world’s preferred ‘flight to safety’ financial instrument, so it looks likely to find support for as long as the US-Iran war continues.”

Gold was quoted at 4,123.33 dollars an ounce, down from 4,282.86 dollars.

On the FTSE 250, Entain fell 5.1%, extending its recent miserable run, after it responded to Brazil introducing an immediate provisional ban on online sports betting and gaming.

Isle of Man-based Entain, which owns the Ladbrokes and Coral brands, continues to expect underlying earnings before interest, tax, depreciation and amortisation of £910 million to £960 million in 2026 and an online underlying Ebitda margin of 21% to 22%, although it now expects both to be towards the lower end of their respective ranges.

Entain said the South American country had been expected to contribute 5% of its global online net gaming revenue in 2026. However, the earnings contribution of that business was expected to be “modest”, thanks to being a very competitive market.

Elsewhere, Tribal Group climbed 19% after accepting an improved takeover offer from Main Capital.

But Bodycote eased 3.1% as CVC Advisers said it does not intend to make an offer for the thermal processing firm.

This leaves the path clear for a rival bid from Veritas Capital Fund Management, which Bodycote accepted at the start of this month.

Among small-cap stocks, Checkit plummeted 22% after it ended a formal sale process after failing to strike a deal it felt able to recommend to shareholders.

The Cambridge-based workflow management software provider said it had received a variety of approaches but had failed to reach agreement on any.

Checkit said the process reinforced its view that it represents a strategically relevant platform in an attractive, consolidating market.

The biggest risers on the FTSE 100 were Barratt Redrow, up 36.2p at 345.2p, Howden Joinery Group, up 23.0p at 782.0p, Airtel Africa, up 7.0p at 306.6p, JD Sports Fashion, up 1.68p at 79.18p and Admiral Group, up 56.0p at 3,674.0p.

The biggest fallers on the FTSE 100 were Fresnillo, down 147.0p at 2,743.0p, Endeavour Mining, down 200.0p at 4,325.0p, Experian, down 93.0p at 2,517.0p, Pershing Square Holdings, down 92.0p at 3,630.0p and Polar Capital Technology Trust, down 15.0p at 684.0p.

Tuesday’s local corporate calendar has full-year results from merchant bank Close Brothers, and half-year results from Irn-Bru owner AG Barr and card retailer Card Factory.

Tuesday’s global economic calendar has the Australian interest rate decision overnight, followed by GDP figures in Canada, inflation and retail sales data in Spain and mortgage approvals numbers in the UK.

Contributed by Alliance News.