10th Sep 2026 06:55
(Alliance News) - Stocks in London are to open flat on Thursday, ahead of a European Central Bank decision, as a US Treasury announcement on bond buybacks failed to inspire.
IG says futures indicate the FTSE 100 to open just 1.9 points higher at 10,671.96 on Thursday. The index of London large-caps closed down 141.60 points, 1.3%, at 10,670.06.
In New York, the Dow Jones Industrial Average lost 0.8%, while the S&P 500 fell 0.5%. The tech-heavy Nasdaq Composite declined 0.6%.
"Yesterday was not a great day. Crude oil kept rising, fueling inflation expectations. Global yields kept rising on bets that central banks will have to raise rates to fight inflation, and equities fell. US technology fared better through the shock, while European stocks posted the strongest losses, with the French CAC 40 diving nearly 2%. And guess what, the US Treasury's announcement that it would triple the size of the initial bond buybacks, to buy up to USD6 billion of outstanding securities set to mature in the 10- to 20-year sector, did nothing," Swissquote analyst Ipek Ozkardeskaya commented.
The yield on the 10-year US Treasury stretched to 4.84% on Thursday morning from 4.81% on Wednesday. The 30-year yield spiked to 5.29% from 5.26%.
On Wednesday, the 10-year yield moved to the cusp of the 4.86% mark, and the 30-year went above 5.31%.
The rise came after the Treasury Department announced it was tripling buybacks of long-term Treasury bonds to USD6 billion, part of a strategy announced last month by Treasury Secretary Scott Bessent to calm the bond market.
The jump in yields also came as Brent oil prices jumped above USD100 a barrel for the first time since late July on escalations in the US-Iran war.
Quintex Intel analyst Stephen Innes commented: "The problem was that the whisper running through parts of the rates market had crept toward USD8 billion to USD10 billion. Treasury brought a garden hose into a market that had started pricing a fire brigade.
"Yields snapped higher on the announcement. A strong 10-year auction later in the session provided some relief, but it could not reverse the broader pressure, leaving the curve in a bear steepening configuration and pushing the 10-year yield to its highest level since November 2023."
In Tokyo on Thursday, the Nikkei 225 was down 0.4%. In China, the Shanghai Composite was 0.5% lower, while the Hang Seng Index shed 1.3%. The S&P/ASX 200 in Sydney was down 1.2%.
Sterling was steady at USD1.3554 early Thursday, where it stood at the time of the London equities close on Wednesday. Versus the euro, it fell to EUR1.1641 from EUR1.1644. Against the yen, the dollar rose to JPY153.64 from JPY153.24.
The euro was largely unmoved at USD1.1638 from USD1.1639, ahead of an expected ECB rate hike on Thursday. The decision at 1315 BST is followed by a press conference with President Christine Lagarde at 1345.
Also due is US producer price data at 1330 BST, a day before Friday's consumer inflation reading. Weekly US jobless claims are also released at 1330 on Thursday. German inflation data is out at 0700.
On Thursday's UK corporate calendar, Primark owner Associated British Foods and electricals retailer Currys issue trading statements.
A barrel of Brent fell to USD100.62 on Thursday morning from USD101.07 at the time of the London equities close on Wednesday. Gold rose to USD4,428.81 an ounce from USD4,420.33.
By Eric Cunha, Alliance News news editor
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