- FTSE 100 falls 79 points to 9,116
- Gold hits new high, UK and US govt bonds on rise
- UK 30yr gilt yield highest since 1998
4.58pm: FTSE closes lower
The FTSE 100 fell 79 points to 9,116 on Tuesday amid a global sell-off of stocks and bonds.
“Markets often see a burst of volatility after US holidays, but today seemed to have something more about it, as European markets nose dived in early trading and bond yields continued to rise," IG chief market analyst Chris Beauchamp said.
"The start of the US cash session saw a recovery off the lows, a sign that dip buyers remain vigilant for any chance to get in on the action. A seemingly cryptic announcement from the White House was revealed to be merely an update on Space Command, at which point any wild fears about the health of the US president were quietly dropped.”
4.16pm: Stocks and bonds selling off
Stocks and bonds are selling off in the UK, Europe and US.
London's blue-chip benchmark is down almost 0.8%, in Frankfurt the DAX has tumbled over 2%, while the Madrid and Milan gauges are both down arond 1.4%, while in Paris the CAC is 0.6% lower.
Over in New York, the Nasdaq is heading up the sell-off, down 1.5%, while the S&P 500 and Dow decline 1.3% and 1%.
Bond yields are surging in the UK and US today, with the 30r gilt hitting 5.7% and the US 30yr Treasury bond back at 5% - similar levels to those seen in the 2008 financial crisis.
3.52pm: Oil support
The FTSE is not the biggest loser today, as rising Brent prices are leading to gains for Shell and BP shares, keeping a lid on losses for the wider benchmark.
But the UK index has declined due to falls for banks, utilities, and real estate companies.
These stocks are all sensitive to interest rates, as investors worry about the country's financial situation, says Patrick Munnely at Tickmill.
With Britain's borrowing costs for 30-year bonds reaching their highest point in more than 27 years, the value of the pound versus the dollar dropped over 1% and almost 0.7% against the euro.
3.15pm: Warning lights
"Warning lights are flashing about increasingly tricky economic conditions and geopolitical risk," says Susannah Streeter, market analyst at Hargreaves Lansdown.
The FTSE is on the back foot "as concerns collide about the global outlook, inflationary pressures and worrisome public finances", with other European indices even further in the red, such as Germany's DAX.
Headlines are flashing about the UK's rising cost of debt, with the 30-year gilt topping 5.7% for the first time since 1998, while US, German and other countries are seeing investors sell their bonds too.
Spot gold has retreated after breaching £3500 an ounce, but remains elevated.
Donald Trump undermining the independence of the Federal Reserve, a confidence vote in France, inflationary pressures, budget pressures on both sides of the pond, and geopolitical risk all are factors leading gold and bond yields higher.
Continued tensions with Russia are showing up in the oil price, says Streeter, with Brent crude rising 2% towards $70 a barrel, levels not seen in almost a month.
2.47pm: Small caps lead decline on Wall St
US stocks gapped down in opening trades.
The big three indices are all down around 1.3%, while the domestically focused Russell 2000 is down 2%.
(Edit, financial stocks on the S&P are pretty much are down but they are not the biggest fallers.)
Aircraft components maker Transdigm Group is down 7%, Corona brewer Constellation Brands has dropped 6.1%, chemiclas group Albemarle and fintech Block Inc are next.
The FTSE 100 is, meanwhile, off its worst.
2.25pm: Trump speech not til this evening
US stock futures are continuing to slide in the information vacuum ahead of a promised Oval Office announcement.
President Trump’s speech will be at 2pm US Eastern Time today, which is 7pm in London.
It will be "related to the Department of Defense," says White House spokeswoman Karoline Leavitt.
Nasdaq futures are down 1.5% and S&P futures are 1.1% in the red, with those for the Dow 0.9% lower.
Earlier, and most probably unrelated to the later speech, the President fired off a couple of posts on social media about crime in Chicago, "the worst and most dangerous city in the world" and that Illinois Governor JD Pritzker "needs help badly".
1.35pm: Shares and bonds under pressure
The FTSE 100 and 250 are sinking lower and lower, with government bonds selling off too to send bond yields on both sides of the Atlantic go higher and higher.
While London's blue-chip benchmark is down 0.7% now, the mid-cap index has tumbled 2%
Retailer Marks & Spencer, bookmaker Entain and wealth manager St James's Place are bottom of the Footsie list, followed by life insurers Phoenix and L&G, and real estate plays Persimmon and Land Sec.
Other retailers, financials and housebuilders are next.
Among the mid-caps, bottom scraping is being led by Ithaca Energy, after major shareholders sold down their stakes.
Then comes Oxford Nanopore, IP Group, Raspberry Pi, Auction Technology and WAG Payment Solutions.
12.19pm: Eurpoean shares slide lower as Wall Street futures drop
The FTSE 100 is down to a two-week low now, 0.5% lower today.
Other European benchmarks are also sinking, with Germany's DAX down 1.5% and Spain's IBEX falling 1.3%.
US futures have slid lower too.
S&P 500 futures are down almost 0.8% and those for the Nasdaq 1% lower, while Dow Jones futures are down 0.6%.
12pm: Klarna IPO eyed by fintech masses
Klarna has confirmed its New York IPO and pricing range, revealing that it aims to raise up to $1.3 billion.
The Swedish-founded, London-headquartered fintech and its banks have priced the offer at between $35 and $37 per share.
Its valuation could be up to $15 billion, based on the pricing range, after a registration statement was filed with the US Securities and Exchange Commission (SEC).
It will be watched by other UK fintech companies like Shawbrook and Zopa and Revolut.
11.26am: Most European equities under pressure
European equities are under heavy pressure this morning, with the DAX down around 1% and Spain's Ibex down 1%, while the FTSE is down 0.3% as gains for oil heavyweights are offsetting wider losses.
Market risk sentiment has soured, says analyst Josh Mahony at Rostro.
"This follows a two-week period of weakness in European stocks, as traders grow increasingly cautious that September could once again bring profit taking and selling pressure.
"Investors are finding little reason to chase stocks higher when bond markets continue to promote the need for caution.
"Notably, we have seen continued gains for long-term yields, with the gap between Euro 2-year yields and the 30-year rising to the highest level since the beginning of 2019.
"In part this reflects the view that while the short-term risks appear to be fading, the consistent rise in borrowing and debt means that many countries are on an unsustainable path that make long-term debt unattractive.
"The upcoming vote of no confidence in France highlights the problems faced by many nations in the West, with any efforts to try and reduce the debt burden ultimately facing a push back against any rise in taxes or spending cuts."
10.35am: EU inflation
Headline inflation in the Eurozone rose to 2.1% year-over-year in August, up from 2.0% in July, as expected.
Core inflation was stable, at 2.3%, above the consensus forecast of 2.2%.
10.09am: Bonds selling off not just in UK
Government bonds are selling off across the curve in the UK and the US.
While the pound is down sharply against the dollar, so is the euro and others.
Some commentators are trying to link it to British politics, with the Budget coming up and the PM's economic appointments yesterday.
Britain’s bond market has "fired a Truss-era style warning shot to the UK government", says Nigel Green at deVere, with the surge in yields forcing Chancellor Rachel Reeves to "weigh politically explosive choices" in her second autumn Budget next month.
Market analyst Michael Brown at Pepperstone says: "There has been little by way of fresh concrete information on the fiscal front in recent weeks, though that in itself is hardly worth cheering, as the backdrop remains a fragile and worrying one."
He says Chancellor Reeves is likely to now need to find a big increase in revenue or spending cuts to restore fiscal headroom to its spring level, which Britain's growth backdrop remains "anaemic" and inflation nears 4%.
"How does this all get fixed? Frankly, there are no easy answers. Further tax hikes are inevitable, though we’re at the stage where they’re almost certain to be counter-productive.
"Cuts to government spending are sorely needed, though likely won’t obtain a majority in the Commons, and thus not be delivered.
"Even greater borrowing, or a relaxation of the fiscal rules, would make the latest episode of Gilt market turmoil look like a ‘storm in a teacup’."
He suggests several fixes, including the Bank of England ending quantitative tightening: "While intentions were good, there is now little-to-no upside to the BoE continuing to run down the size of its balance sheet, especially when the ‘Old Lady’ is still actively selling down its Gilt holdings.
"This not only results in the BoE (& HMT, by extension) crystallising losses on the portfolio, but also exerts significant upwards, and unnecessary, pressure on the long-end of the curve, especially when the monetary policy implications of QT are minimal."
He also calls for "Reeves out", saying the Chancellor’s position in Number 11 "has been unsustainable for some time now".
Brown, likely not a Labour voter, also calls for sizeable spending cuts rather than tax hikes.
"In the meantime, however, and if drastic action is not taken, it seems highly unlikely that the trajectory for UK assets will change any time soon.
"To be clear, that means further pressure on long Gilts, and further pressure on the GBP as well, with recent gains having been built on foundations of sand."
9.35am: Pound tumbles
The pound is tumbling, down 1% to $1.34 and down 0.4% versus the euro at £0.868.
Meanwhile, gilt yields also spiked earlier, though have come back a little. US Treasury yields are also rising in sync with the USD.
The FTSE 100 is down 30 points, while the FTSE 250 has dropped 229 points or almost 1.1%.
9.03am: Smoot-Hawley klaxon
With the US back online later, focus turns Stateside today.
After the illegal tariff ruling at the end of last wee, Treasury Secretary Scott Bessent has opined that the (Republican-tilted) Supreme Court would side with the Trump administration over the legality of tariffs.
Bessent also said there were other means to get tariffs to stick, citing the 1930 Smoot-Hawley Tariff Act.
For market analyst Neil Wilson and others this rings alarm bells, also sparking memories of the classroom scene in Ferris Bueller's Day Off.
(Wilson, potentially using a photographic memory for economic references in 80s films, reproduces the full speech citing the Hawley-Smoot Tariff Act speech... "Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression.”)
"Markets don’t like talk of this sort," says Wilson, "Smoot-Hawley is widely regarded as a stunning example of economic self-harm.
"The US stock markets were closed yesterday for Labor Day , so I guess we’ll find out the reaction to the court ruling that said most of Trump tariffs are illegal, and the response from the White House via Bessent, today."
He adds that markets "should be used to the volatile and erratic application of Trump’s economic policies, particularly with regard to tariffs.
"They are not just a simple case of looking at the accounting and moving some figures around.
"They are global power politics and a reshaping of the world order. And it’s happening at the same time as the administration continues to assail the Federal Reserve."
He also notes that gilt yields in the UK rose yesterday after PM Keir Starmer reshuffled the deck, poaching chancellor Rachel Reeves's deputy.
"If the Treasury won’t break the rules, then perhaps Number 10 can?
"The market move was a sign that investors do not have confidence the Treasury will stick to its strict borrowing rules."
Long-dated gilt yields are now trading close to 27-year highs again, he notes, with the 30yr above 5.68%, which "underscores that there is little fiscal or economic credibility left".
European bonds also rose yesterday.
8.50am: All the results from the FTSE 350
The only FTSE 350 company reporting today is Oxford Nanopore Technologies PLC (LSE:ONT), whose shares are down almost 3% despite the molecular sensing specialist reporting a smaller underlying loss than expected.
Overall, interim results were roughly in line with its recent update, with management also reaffirming the full-year and medium-term outlook.
Revenue of £105.6 million for the first half of 2025 was up 25.6% compared to a year ago, while adjusted EBITDA losses narrowed to £48.3 million from £61.7 million a year earlier.
Analyst James Orsborne at Stifel, who has a 'sell' on the shares, says the underlying loss was slightly better than the average City forecast of £56 million, which he said was due to the solid growth in the period and cost control.
The second half of the year "will be the real test", he added.
8.15am: FTSE starts with a slump
The FTSE 100 has slumped lower at the open, down 33 points to 9,163.
BAT is leading the fallers, followed by a band of utilities, retailers, housebuilders and property developers.
Shell and BP are among the top risers, as Brent crude climbs back towards $69 a barrel.
7.56am: Shawbrook beefs up SME lending
Shawbrook Bank the challenger bank that is thought to be planning an IPO, has announced the acquisition of specialist SME lender ThinCats.
"ThinCats has an established market position, proven origination capabilities and a technology-enabled business model that is strategically aligned to Shawbrook's," the lender said.
Shawbrook CEO Marcelino Castrillo says a "leading UK fintech with an excellent track record for delivering bespoke funding to growth-focused SMEs, whose owners, management teams and sponsors value speed, flexibility and certainty.
"ThinCats' approach is aligned to our own strategy of leveraging technology, credit excellence and an entrepreneurial culture to deliver a premium proposition to established UK SMEs."
The SME segment accounted for 21% of the lender's total loan book as of June.
7.44am: Good news for Centrica's nuclear portfolio
British Gas owner Centrica PLC (LSE:CNA) has hailed the one-year life extensions of the Heysham 1 and Hartlepool nuclear power stations, where it holds a 20% stake.
Both plants are now expected to operate until March 2028, with the extensions expected to add three terawatt-hours (TWh) of electricity generation between 2026 and 2030.
Chief executive Chris O'Shea says: "The UK needs more reliable, affordable, zero-carbon electricity, so the extension of Heysham 1 and Hartlepool is great news."
7.31am: Gold and silver on a tear
Gold's fresh all-time high of almost $3,505 per ounce was reached in the early hours of this morning, surpassing its previous peak in April.
"The rally reflects a softer dollar but also strong central-bank and institutional demand as investors rotate out of US Treasuries," says Swissquote Bank's market analyst, Ipek Ozkardeskaya.
That decline in the share of US Treasuries held by foreign central banks has been going on for over a decade, but the shift into gold has accelerated this year, amidst what analysts and economists have attributed to US debt concerns, trade tensions and geopolitical risks.
"Central banks’ gold allocations even surpassed their US Treasury holdings this year," says Ozkardeskaya.
"Meanwhile, Indian pension funds are seeking approval to invest in gold ETFs, hinting at strong demand despite record price."
Silver also surged to its highest level since 2011.
"Both metals have further room to run. Yet, with the gold–silver ratio still above its long-term range of 60-80, silver may have greater upside potential," she says.
7.15am: FTSE 100 expected to make cautious start, gold hits new high
FTSE 100 futures were anticipating a slow start on Tuesday, with commodities markets also indicating the caution in the air as the price of gold rose to a new high.
The London index was called three points higher ahead of the open, having added nine the day before to close at 9,196 in a quiet session with US markets closed yesterday.
Overnight, gold spiked to a new all-time high above $3,500 an ounce, up from around $3,375 a week ago and $2,560 at the start of the year.
Silver also broke above $40 an oz for the first time since 2011.
Asian stock markets are mixed this morning, with no big moves either way, including a further 0.4% rebound for India's Sensex and a 0.3% dip for the Hang Seng in Hong Kong.
"Today marks the start of the final stretch of the year as the US returns from yesterday’s Labor Day holiday," says Deutsche Bank's Jim Reid.
He notes that European markets saw familiar themes, with long-end bond yields creeping higher amid ongoing fiscal concerns, such that 30-year German, French and Dutch bonds reached their highest levels since the Euro crisis in 2011, while the UK’s 30-year gilt yield hit its highest since 1998.
"Even in orderly markets, we’re seeing a slow-moving vicious circle: rising debt concerns push yields higher, worsening debt dynamics, which in turn push yields higher again."