British equities fell on Tuesday as higher energy prices and disagreements over artificial intelligence (AI) oversight weakened investor confidence. The FTSE 100 declined 0.60%, while Germany’s DAX lost 0.36% and France’s CAC 40 dropped 0.64%. The pound slipped 0.21% to $1.3472. Brent crude rose 1.67% to $107.42 a barrel after disruption to Saudi Arabia’s East-West pipeline system, while WTI crude gained 1.7% to $103.09. Shipping through the Strait of Hormuz fell to four vessel transits on Monday from 10 previously, based on Kpler data reported by Reuters. UK payroll employment fell by 26,000 in August after July’s revised 19,000 decline, leaving PAYE employment 0.5% below its year-earlier level. The unemployment rate held at 4.9% for a fourth consecutive month, below the anticipated 5% level. Private-sector employment dropped by 34,000, while retail and hospitality recorded annual declines exceeding 3%. Vacancies fell to 702,000 in the three months through August from 706,000, the weakest level outside pandemic disruptions in more than 10 years. Annual earnings growth including bonuses eased to 3.9% in July from 4.2% in June, while regular pay growth remained at 3.5%. Capital Economics said the weaker labor market supports the view that energy-driven inflation pressures will remain contained. Market analysts expect the Bank of England to keep its interest rate at 3.75%, with ING forecasting a 6-3 Monetary Policy Committee vote to maintain current rates. Debate over AI governance also weighed on sentiment: Anthropic CEO Dario Amodei called for stronger safeguards and independent third-party evaluations, while OpenAI’s Sam Altman and Elon Musk supported a measured development approach. US President Donald Trump opposed slowing AI progress, saying restrictions could weaken competition with Chinese AI companies. Trustpilot reported first-half revenue of $151.4 million, up 23%, and Kier Group reported full-year revenue of £4.39 billion, up 7.5%, with a record £11.9 billion order backlog entering 2027. Gold futures fell 0.52% to $4,328.87 ahead of Wednesday’s Federal Reserve policy announcement, with ING describing precious metals as vulnerable.