London Stocks Open Lower as US Treasury Yields Rise, Bank of England Decision Awaited
London stocks opened on a lower note on Thursday as U.S. Treasury yields increased following the Federal Reserve’s indication of elevated interest rates for a longer period. Investors are also preparing for the Bank of England’s key monetary policy decision, set to be announced later in the day.
By 0710 GMT, the blue-chip FTSE 100 index was down 0.5%, while mid-cap stocks experienced a dip of 0.4%. While the Federal Reserve maintained its interest rates on Wednesday, it took a more hawkish approach to its monetary policy in a bid to combat inflation.
Asian stocks mirrored the subdued sentiment in the U.S. markets after the Fed revised its economic projections. The Bank of England will soon reveal whether it will halt a streak of interest rate hikes that began in December 2021.
Contributing to the decline in the benchmark index was a 1.4% slump in industrial miners as the prices of metals denominated in the U.S. dollar weakened. Shares of trading platform IG Group, as well as homebuilders Crest Nicholson and Redrow, saw a drop of between 3% and 5% as they traded ex-dividend.
Next, a clothing retailer, saw a rise of 1.3% after raising its full-year profit outlook for the third time in four months. JD Sports Fashion also climbed nearly 6%, leading the FTSE 100, as the sportswear retailer predicted a higher annual profit.
The broader retailers’ index experienced a nearly 1% increase, leading the sectoral gains.
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