The FTSE 100 dropped more than 1.5% to 10,432 on Thursday, its lowest close since June 23, as UK equities tracked a broad sell-off across European markets. The move came amid a climb in global bond yields, with the 30-year gilt yield briefly rising above 6% for the first time since 1998. The increase in borrowing costs was driven mainly by international factors, including higher yields in France and the US, rather than by developments in UK domestic politics.
Banks were among the hardest hit, with HSBC down more than 4%, Lloyds off 4.4%, NatWest 5.2%, Barclays 3.8% and Standard Chartered 3.2%. Defensive heavyweights also declined: AstraZeneca and GSK slipped 1.8% and 1.6% respectively, while Unilever dropped 2.4% and BAT 3.4%. Miners weakened as well, led by Rio Tinto and Glencore.
Energy stocks were a notable exception, with Shell and BP advancing as oil prices rose. Separately, Nationwide reported that UK house prices fell 0.2% in September, slowing annual growth to 0.8%, the weakest pace so far this year.
