FTSE 100 Live: Sharp fall expected after bond rout
The FTSE 100 is expected to start in reverse gear on Thursday ahead of the Bank of England decision today and a packed morning of company results, including Shell, Lloyds, Rolls, BAE Systems and BAT.
Futures point to the blue-chip index opening around 60 points lower, a day after it added 37.4 points to close at 10,908.41.
Wall Street provided a weak lead after the Federal Reserve held interest rates but three policymakers voted for an increase.
The Dow Jones fell 1,153 points, or 2.2%, while the S&P 500 lost 1.5% and the Nasdaq dropped 1.7%.
Longer-term bond yields climbed after Fed chair Kevin Warsh offered little guidance on the future path of rates. The 30-year Treasury yield rose above 5.2% for the first time since 2007. UK gilts climbed back above 5%.
Renewed fighting involving the US and Iran added to the pressure, sending Brent crude surging almost 8% overnight and spiking a further 1.4% this morning above $92 a barrel.
The Bank of England decision is due at midday, with the monetary policy committee widely expected to leave interest rates unchanged at 3.75%.
Many economists expect some members of the MPC to vote for a quarter-point increase in rates, while markets are pricing in a roughly 60% chance of a rate rise by September.
Investors must also digest results from Shell, Lloyds Banking Group, Rolls-Royce, London Stock Exchange Group, BAE Systems, British American Tobacco, Haleon and Rentokil Initial. Updates are also due from Pets at Home, Segro, Chemring, Elementis, Foxtons and Vanquis Banking Group.
US technology stocks are likely to remain a key market story, with earnings producing a mixed response after last night’s closing bell.
Microsoft jumped almost 9% after stronger cloud growth, while Meta fell more than 7% following disappointing sales guidance. Qualcomm lost 4.7%, while Starbucks gained 4.7%.
Apple and Amazon report after Thursday’s US close.