London’s FTSE 100 slipped on Monday, weighed down by the pharmaceutical and energy sectors, while investor optimism around a highly anticipated interest rate cut by the European Central Bank in this week’s policy decision contained declines.

The blue-chip FTSE 100 index closed down 0.2%, while the mid-cap FTSE 250 advanced 0.8% in its third session of gains.

The pharma and biotech sector slumped 1.5%, after hitting an over one-month low during the day. Drugmaker GSK sank 9.5% to the bottom of the FTSE 100 after a Delaware ruling allowed more than 70,000 lawsuits to proceed over GSK’s discontinued heartburn drug Zantac.

Energy stocks also lost 1.2%, in tandem with oil prices, which slipped over $2 per barrel.

Declines in the market were contained by broader gains on investor optimism ahead of the ECB’s meeting later this week, where it is expected to commence its interest rate cutting cycle.

London stocks edge higher ahead of ECB rate decision; GSK slumps

A survey from the Institute for Supply Management showed slowing U.S. manufacturing activity in May, fuelling some expectations of a September rate cut from the Federal Reserve.

“There is increased optimism of interest rate cuts as we head towards the ECB meeting, and U.S. manufacturing data adding to signs that consumers are reining in their spending,” said Fiona Cincotta, senior market analyst at City Index.

Analysts predict the Bank of England (BoE) will closely shadow the ECB’s movements. However, traders have priced in a 25-basis-point cut by the BoE only in November.

“The Bank of England will (not) necessarily be taking decisions on what the ECB is doing, given that this (decision) might be a cut and then a pause rather than the start of back-to-back cuts,” Cincotta added.

A separate survey showed British manufacturers reported a return to growth in May, but higher prices charged by firms could add to the BoE’s caution around cutting rates.

Among other stocks, JD Sports Fashion jumped 5.1% topping the FTSE 100, after a 4.7% slump on Friday.