FTSE 100 LIVE: Stocks stage recovery after global bond sell-off while gold hits fresh highs

The FTSE 100 (^FTSE) and European stocks were higher on Wednesday, bouncing back from steep losses in the previous session, as the global sell-off in long-term government debt continues.

After losses across the bond and equity markets on Tuesday, Britain’s long-term borrowing costs has hit a new 27-year high, building pressure on chancellor Rachel Reeves.

The yield, or interest rate, on 30-year UK gilts rose to 5.747% on Wednesday, above the high of 5.723% hit on Tuesday.

Elsewhere, the 30-year Japanese government bond yield hit an unprecedented 3.255%, following the jump in UK, US and eurozone bond yields. Yields on Japan’s 20-year government bonds rose to levels last seen in 1999.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The FTSE has rebounded slightly this morning after shedding 80 points on Tuesday. Storm clouds are gathering ahead of Rachel Reeve's second Budget with long-term gilt yields hitting over 5.7%, nearly the highest levels seen in three decades and sterling having its weakest day against the Greenback since liberation day.

Read more: Trending tickers: Alphabet, Apple, Heinz, Salesforce and Ashtead

"The bond sell off has not just been confined to UK shores, with 30-year US Treasuries reaching nearly 5%, reflecting investor concerns about the ballooning US deficit and fiscal looseness under the Trump regime. So far, tariff revenue's not been enough to start rebalancing the books."

Meanwhile, the price of gold has hit a fresh record high of $3,546.99 per ounce, on track for its seventh daily rise in a row as investors seek out a safe haven.

Later in the day, investors will tune into comments from European Central Bank (ECB) president Christine Lagarde for any insights on monetary policy, while also expecting US job openings data for July.

London’s benchmark index (^FTSE) was 0.5% higher in early afternoon trade. Germany's DAX (^GDAXI) rose 0.8% and the CAC (^FCHI) in Paris headed 0.9% into the green. The pan-European STOXX 600 (^STOXX) was up 0.7%, led by a gain in technology, the top-performing sector. Wall Street is set for a positive start as S&P 500 futures (ES=F), Dow futures (YM=F) and Nasdaq futures (NQ=F) were all in the green. The pound was 0.1% up against the US dollar (GBPUSD=X) at 1.3401, recovering from the one-month low seen on Tuesday.

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7 mins ago

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Alphabet surges after US federal judge decision

Shares in Google's parent company Alphabet (GOOG, GOOGL) surged by over 5% in pre-market trading after a US federal judge stopped short of ordering the break-up of the tech giant’s Chrome browser or Android mobile platform.

The decision by Judge Amit Mehta follows his earlier ruling that Google violated antitrust laws by maintaining a monopoly in online search. However, the remedies imposed were far less severe than markets had feared.

Mehta rejected the US Department of Justice’s request to force Alphabet (GOOG, GOOGL) to divest its Chrome business. Nor will the company be compelled to sell off Android, the mobile operating system that powers the majority of the world’s smartphones.

Judge Mehta’s ruling “doesn’t seem to be as draconian as the market was expecting,” said Melissa Otto, head of TMT Research, at S&P Global Visible Alpha.

Still, the judgment imposes constraints. Google will now be required to share certain search data with rivals and will be prohibited from striking exclusive contracts to maintain its search engine’s dominance.

"Today's decision recognises how much the industry has changed through the advent of AI, which is giving people so many more ways to find information," Google said in a statement after the ruling.

"This underlines what we've been saying since this case was filed in 2020: Competition is intense and people can easily choose the services they want," the statement added. 27 mins ago

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FTSE risers and fallers

As we sail into the afternoon, here are the FTSE risers and fallers today: 53 mins ago

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UK services sector growth rises

The UK’s services sector climbed to a 16 month high last month, the steepest rate since April 2024, thanks to revival of activity in the industry.

The services PMI for August rose to 54.2, up from 51.8 in July, largely to due of a rise in new orders as demand recovered.

Tim Moore, economics director at S&P Global Market Intelligence, said:

But Matt Swannell, chief economic advisor to the EY ITEM Club, warned that “poorer performances from sectors not covered by the S&P Global survey, such as retail and health, the latter due to July’s strikes by resident doctors, will likely mean GDP growth is softer in Q3 than the PMIs imply”.

He added: Today at 10:31 AM UTC

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Oil prices fall ahead of OPEC+ meeting

Oil prices fell by more than 1.5% on Wednesday ahead of an upcoming meeting of OPEC+ producers that is expected to consider another increase in production targets in October.

Brent crude fell to $67.98 a barrel at the time of writing while US West Texas Intermediate crude fell 1.9%, to $64.32.

It comes as eight members of the Organisation of the Petroleum Exporting Countries and allies (OPEC+) will consider further raising oil production at a meeting on Sunday, two sources familiar with the discussions told Reuters.

The boost would mean that OPEC+, which pumps about half of the world's oil, would be starting to unwind a second layer of output cuts of about 1.65 million barrels per day, or 1.6% of world demand, more than a year ahead of schedule.

The group had already agreed to raise output targets by about 2.2 million barrels per day from April to September, in addition to a 300,000 bpd quota increase for the UAE.

It also follows the US Treasury Department announcing on Tuesday a round of sanctions on a network involved in selling Iranian crude abroad after blending it with Iraqi crude in order to disguise its real origin.

“By targeting Iran’s oil revenue stream, Treasury will further degrade the regime’s ability to carry out attacks against the United States and its allies,” Treasury Secretary Scott Bessent said in a statement. Today at 10:04 AM UTC

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Rise in gilt yields risks mortgage rate pressure

The sharp rise in the UK's long-term borrowing costs risks pushing up mortgage rates, analysts have warned.

Matthew Ryan, head of market strategy at global financial services firm Ebury, said: Today at 9:43 AM UTC

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Copper retreats from five-month high

Copper prices retreated after briefly touching their highest level since late-March, as traders weighed up the outlook for supply and demand in China.

The wiring metal gained 3% in August, and has posted a decent start to September, surfacing above $10,000 a ton in intraday trading on Tuesday and Wednesday. Analysts have said that a weak dollar and the prospect of US interest rate cuts have given support, as well as a focus on the state of the Chinese market.

“With reduced supply and stable demand, inventory levels are expected to decrease, which will support upward price moves,” Jia Zheng, head of trading at Shanghai Soochow Jiuying Investment Management Co told Bloomberg.

Copper on the LME is up around 14% year-to-date, and has made a solid recovery following president Donald Trump’s global tariff offensive in April.

Meanwhile, demand in China had a strong first half, with Goldman Sachs predicting softer conditions for the rest of the year.

Copper rose as much as 0.6% to $10,038 a ton on Wednesday, before trading 0.1% lower to $9,967. Today at 9:14 AM UTC

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UK cement production drops to lowest levels since 1950s

UK cement production has tumbled to its lowest level since 1950, putting the government's house building plan at risk.

The Mineral Products Association (MPA) warned on Wednesday that production levels were "increasingly under threat" due to high energy, regulatory and labour costs.

The Department for Business and Trade said it recognised challenges in the sector and its Industrial Strategy was increasing help for energy-intense companies, which include cement manufacturers.

It comes as the Labour party has pledged to build 1.5 million new homes in England by 2029 in a bid to solve the housing crisis and boost economic growth.

Under a separate investment strategy unveiled in June, Chancellor Rachel Reeves pledged to pour £725bn over the next decade into maintaining existing infrastructure and building new projects.

According to the MPA, the UK only made 7.3 million tonnes of cement in 2024, around half of that produced in 1990 and similar to production levels seen when rationing was still in place following World War Two. Today at 8:58 AM UTC

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Gold hits new record high

Gold prices have climbed to a new record high as investors seek out a safe haven following a recent selloff in equity and bond markets and ongoing global economic uncertainty.

The spot price rose 0.4% on Wednesday to hit $3,546.99 per ounce, narrowly higher than Tuesday’s peak, and on track for its seventh daily rise in a row.

It also comes as the prospect of US interest-rate cuts boosts the metal’s appeal after Federal Reserve chair Jerome Powell cautiously opened the door to a reduction.

Prices have advanced around 5% over the past seven sessions, underpinned by increased haven demand amid renewed worries over the Federal Reserve’s future and concerns about sovereign debt levels in developed-world countries.

It has risen more than a third this year, making it one of the best-performing major commodities. Silver’s surge has been even sharper, with the price edging further above $40 an ounce this week. Today at 8:38 AM UTC

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UK long-term borrowing costs hit fresh 27-year high

Britain’s long-term borrowing costs has hit a new 27-year high, building pressure on Rachel Reeves.

The yield, or interest rate, on 30-year UK gilts has risen to 5.747% this morning, above the high of 5.723% hit yesterday.

Elsewhere, the 30-year Japanese government bond yield hit an unprecedented 3.255% overnight, following the jump in UK, US and eurozone bond yields. Yields on Japan’s 20-year government bonds rose to levels last seen in 1999.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: Today at 8:21 AM UTC

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Rachel Reeves to deliver budget on 26 November

Chancellor Rachel Reeves’s autumn budget will take place on 26 November, the Treasury has announced.

It comes as the UK government has to give the Office for Budget Responsibility (OBR) at least 10 weeks notice to conduct its assessment of the government’s tax and spending plans, in order for them to give its verdict once the budget speech has been delivered.

The late November budget date will give Reeves time to prepare the ground for potential tax changes, and address the ‘black hole’ that may have been widened by the recent sell-off in the bond markets.

Even before the cost of government borrowing reached a 27-year high, ministers were already having to find tens of billions of pounds in spending cuts or tax rises. Today at 7:59 AM UTC

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Asia and US stocks overnight

Stocks in Asia were lower overnight, following the global trend, with the Nikkei (^N225) fell 0.9% on the day in Japan, while the Hang Seng (^HSI) fell 0.6% in Hong Kong.

Yields on Japan’s longer maturity JGBs continued to be at multi-decade highs, following the global selloff in bonds and political uncertainty in the nation. Yields on 20-year government bonds are up 3.1bps to trade at 2.667%, a level last seen in 1999 while those on the 30-year are 4.1bps higher to 3.26%, its highest since its debut in 1999.

The Shanghai Composite (000001.SS) was 1.2% down by the end of the session and in South Korea, the Kospi (^KS11) added 0.4% on the day.

Across the pond on Wall Street the S&P 500 (^GSPC) lost 0.7%, and the tech-heavy Nasdaq (^IXIC) was 0.8% down, with the Mag-7 1.08% down as tech underperformed.

The Dow Jones (^DJI) fell 0.6% on the day, partially recovering after trading 1.5% lower intra-day. It was still a broadly weak day with more than three-quarters of its constituents losing ground.

It came as a second court hearing began yesterday on whether President Trump can be temporarily barred from dismissing Fed Governor Lisa Cook, though Bloomberg reporting suggests that there likely won’t be a ruling before the end of the week.

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At close: September 2 at 4:49:03 PM EDT Advanced Chart Today at 7:42 AM UTC

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Coming up

Good morning, and welcome back to our markets live blog. As usual we will take a deep dive into what moving markets and happening across the global economy.

Looking ahead, today brings the US JOLTS report, factory orders, and August vehicle sales. In Europe, we’ll get Italy’s services PMI and Eurozone PPI, while Canada releases Q2 labour productivity.

Central banks are also busy: the Fed’s Beige Book is due, with remarks from Musalem, Lagarde, Bailey, and several other BoE speakers. On the earnings side, highlights include Salesforce, HPE, Gitlab and Dollar Tree.

Here's a snapshot of what's on the agenda:

7am: Trading updates: Hilton Food, Bakkavor, NCC 9am: Eurozone service sector PMI for August 9.15am: Bank of England deputy governor Sarah Breeden keynote speech at a conference on innovation in money and payments conference 9.30am: Eurozone service sector PMI for August 2.30pm: Treasury Committee hearing with Bank of England policymakers 3pm: JOLTS survey of the US jobs market

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