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London pre-open: Stocks to slump as bond yields rise

Fri 19 March 2021 07:40 | A A A

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(Sharecast News) - London stocks were set to slump at the open on Friday, taking their cue from a weak session on Wall Street amid concerns about rising bond yields.

The FTSE 100 was called to open 68 points lower at 6,711.

CMC Markets analyst David Madden noted that the US 10-year yield hit a 14-month high of 1.75% on Thursday.

"Tech stocks sold off greatly due to the jump in yields, tech companies are less popular with traders these days as funds are being re-directed to lockdown-stricken industries like travel and hospitality. The Dow Jones has a relatively small exposure to the technology sector and it fell by 0.46%, while the tech-heavy Nasdaq dropped by over 3%," he said.

"Traders in Asia were spooked by the declines seen in the US, hence the selling pressure in the Far East. The Bank of Japan made a reference that the ETF purchase programme will only focus on Topix-linked ETFs, which hurt the Nikkei. European stocks are set to open lower."

In corporate news, NatWest is spending £1.1bn to buy almost 5% of its shares from the UK Treasury, which became the bank's majority shareholder during the financial crisis.

Pub chain JD Wetherspoon swung to a heavy half-year loss as it felt the impact of Covid restrictions.

The company reported a loss before tax and exceptionals of £46.2m compared with a profit of £57.9m. Revenue slumped 53.8% to £431m as Wetherspoons was forced to close its pubs in the latest lockdowns.

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