FTSE 100 drops to three-month low as surging yields hit risk appetite
EWU•The FTSE 100 fell 1.68% to 10,428.7, its lowest in three months and biggest one-day decline since May 15, as bond yields surged to multi-decade highs. The FTSE 250 slipped 1.62%.
1. Stocks fall, yields rise
The FTSE 100 closed down 1.68% at 10,428.7 points on Thursday, its fourth straight day of losses. The British 30-year gilt yield reached 5.9352%, its highest since early 1998, while the 10-year yield climbed to 5.4033%, its highest since 2007.
2. Banks lead declines
Banks fell 4.2% to their lowest in more than three months, with HSBC and Barclays down about 4% each and NatWest falling 5.4%. Investors also weighed concerns about the UK fiscal outlook ahead of the budget later this month. Traders were pricing in an 85% chance of a Bank of England rate increase at its November meeting.
3. Other market moves
Brent crude rose $3 after China suspended oil products exports. Homebuilder stocks declined 4.9% as British house prices recorded their weakest annual growth since December 2025.
