UK's FTSE 100 slips ahead of Fed outcome, energy stocks weigh

FTSE 100 down 0.3%, FTSE 250 off 0.2%

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Aston Martin drops after bigger than expected Q1 pretax loss

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Haleon falls after missing Q1 revenue estimates

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UK factories slip back into downturn as cost pressures rise

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U.S. Fed policy decision due at 1800 GMT

May 1 (Reuters) - Britain's FTSE 100 slipped on Wednesday, led by declines in energy stocks, while investors grew cautious ahead of the U.S. Federal Reserve's policy decision later in the day, hoping for hints on its interest rate path.

The blue-chip index closed down 0.3%, while the mid-cap FTSE 250 ended off 0.2%.

Heavyweight oil and gas shares slipped 1.7% as oil prices fell over 2% to a seven-week low, weighed down by a surprise build in U.S. crude stocks, the prospect of a Middle East ceasefire agreement and persistent U.S. inflation.

As inflation remains stubbornly above the U.S. central bank’s 2% annual target, the Fed is almost certain to hold its benchmark overnight interest rate steady later on Wednesday.

However, investors await comments from Fed Chair Jerome Powell that could give clearer insights into the central bank's view on potential rate cuts.

"The question is what the Fed can say to boost hopes ... even the optimism of the FTSE 100 was no match for the familiar weight of weary expectation," said Danni Hewson, head of financial analysis at AJ Bell.

Money markets now anticipate 30 basis points (bps) of U.S. rate cuts this year, down from the initial estimate of 150 bps in 2024, according to LSEG data.

Traders expect around 38 bps of rate cuts from the Bank of England and nearly 60 bps from the European Central Bank this year, easing pressure on European stock markets compared to those in the U.S.

Meanwhile, British manufacturing fell back into contraction in April and cost pressures escalated, though the pace of decline was a little less marked than first feared, a survey showed.

In corporate updates, GSK advanced 1.9% after the drugmaker raised its full-year profit forecast and said its sales would be higher in the first half of the year.

Shell has exited China's power markets as part of CEO Wael Sawan's drive to focus on more profitable operations, taking its shares down 1.5%.

Haleon fell 2.5% after the consumer healthcare firm's first-quarter revenue missed estimates.

Dragging UK midcap stocks lower, Aston Martin slumped 6.7% after the luxury carmaker posted a bigger than expected first-quarter pretax loss. (Reporting by Pranav Kashyap, Khushi Singh and Sruthi Shankar in Bengaluru; Editing by Sherry Jacob-Phillips, Rashmi Aich and Mark Potter)