FTSE 100 slips 0.1% as Fed independence row rattles markets - NatWest -2.5%, Hochschild -9.3%

London's main indexes finished the session slightly in the red on Wednesday, as worries over the U.S. Federal Reserve's independence unsettled investors and knocked the shine off recent gains.

The blue-chip FTSE 100 closed down about 0.1%, slipping further after Tuesday's decline. Midcaps didn't fare much better: the FTSE 250 ended roughly 0.3% lower, still more than 11% shy of its September 2021 peak.

Banks took the hit. NatWest (LSE: NWG) was among the worst performers, dropping roughly 2.5% as traders rotated away from financial names. It wasn't an isolated move - the sector felt heavy all day.

The mood soured after U.S. President Donald Trump said he intended to remove Federal Reserve Governor Lisa Cook, a comment followed by reports that Cook's legal team will seek to block any dismissal. That back-and-forth raised fresh doubts about the Fed's autonomy, undercutting last week's optimism that had pushed the FTSE to record highs after Fed Chair Jerome Powell hinted a September rate cut could be on the table.

Commodity and mining names added some drama in the midcap space. Hochschild Mining (LSE: HOCM) plunged around 9.3% after cutting its full-year output forecast for the Mara Rosa operation by more than half. On the bright side for the consumer sector, JD Sports Fashion (LSE: JD) climbed about 3.6% after signs of stabilisation in its U.S. business.

Insurance heavyweight Prudential (LSE: PRU) flagged a $1.1 billion buyback and a plan for higher dividends over the next two years following a 12% rise in first-half new business profit, yet the stock finished the session about 1.7% lower as initial gains faded.

Macro and market micro moves were modest elsewhere: the U.S. 10-year Treasury yield nudged up roughly one basis point to about 4.27%, while equities globally were keeping one eye on earnings season-none more so than Nvidia (NASDAQ: NVDA), which had traders on standby ahead of its results later in the day.

So the takeaway: last week's breathless record was followed by a reality check. Will a legal tussle over Fed governance and a busy earnings calendar keep things choppy? Tonight's Nvidia print will be a decent test.