FTSE 100 dips but registers weekly gain; investors assess economic data

Sept 12 (Reuters) - Britain's FTSE 100 reversed earlier gains to close lower on Friday, dragged down by consumer staples and healthcare stocks, while investors assessed key domestic economic data.

The blue-chip FTSE 100 .FTSE closed down 0.2% but registered its second straight weekly gain. The domestically focused mid-cap index .FTMC fell 0.3% but recorded a weekly rise.

Hopes of an imminent interest rate cut by the U.S. Federal Reserve, a surge in gold prices, and a rally in the defence sector have provided some support to the FTSE 100 this week.

Data on Friday showed Britain's economy recorded no growth in July after a sharp drop in factory output, matching expectations for a slower start to the second half of 2025 but still disappointing for the government ahead of November's budget.

Fiona Cincotta, senior market analyst at City Index, said, "The outlook for growth remains weak for the UK," adding that despite the weaker growth, the BoE is likely to hold steady on interest rates until potentially early next year because of sticky inflation and uncertainty surrounding the November budget.

Healthcare stocks .FTNMX201030 fell 1.2%. Heavyweight AstraZeneca AZN.L lost 1.4%.

A top industry lobby group warned a challenging business environment was hurting the sector.

Energy stocks .FTNMX601010 lost 0.5%. BP BP.L declined 1%.

Precious metal miners .FTNMX551030 declined 0.8% with Fresnillo FRES.L down 1.8%.

Some consumer staples stocks also declined. Diageo DGE.L fell 1.9%.

Retail stocks .FTNMX404010 lost 0.7%, with JD Sports Fashion JD.L falling 2.2% to the bottom of the benchmark index.

Conversely, the aerospace and defence sector .FTNMX502010 rose about 1%, hitting a fresh record high and recording its largest weekly rise in over six months. BAE Systems BAES.L rose 1.7%.

Utility stocks .FTUB6510 such as United Utilities UU.L and SSE SSE.L advanced 1.6% each.

Industrial miners .FTNMX551020 rose, tracking higher copper prices. Glencore GLEN.L gained 1.6%.

In other moves, online supermarket and tech firm Ocado OCDO.L fell 19.9% to the bottom of the mid-cap index, after its U.S. partner Kroger KR.N signalled a potential retreat from investment in automated warehouses.

JTC JTC.L said it was in separate talks with private equity firms Warburg and Permira. Shares of the financial services firm hit a record high, up 15.8%, to top the mid-cap index.