London mid-caps face weekly losses amid bond concerns

FTSE 100

London’s mid-cap stocks were poised for their most significant weekly decline in three months on Friday, weighed down by apprehensions regarding escalating government debt and inflation. Meanwhile, Experian experienced a downturn following criticism from the U.S. housing regulator regarding the sector’s practices.

The FTSE 100 index was steady at 10,832.9 points by 1007 and was set for a flat week, while the FTSE 250 rose 0.2%, trimming some of its weekly losses.

  • Experian opens new tab shed 3.5% after U.S. Director of Federal Housing, Bill Pulte, accused credit reporting agencies of overcharging Americans for “far too long” and directed the mortgage finance giants Fannie Mae and Freddie Mac to approve all lenders to use VantageScore.
  • Mid-cap stocks have faced significant pressure this week due to escalating tensions in the Middle East, which have triggered a global bond selloff. Investors are increasingly concerned about inflation in the context of elevated government debt.
  • Earlier this week, the benchmark 10-year gilt yield reached its highest level since August 2007, as investors expected interest rates to increase by a minimum of 25 basis points before the end of the year, according to LSEG data.
  • Bank of England Governor Andrew Bailey stated that weak productivity and shocks such as COVID-19 have played a role in the increase of public debt in advanced economies. The forthcoming budget, under the leadership of Andy Burnham, is anticipated to be revealed in October.
  • “It just highlights ​a very tight situation ​that the UK ⁠government is going to find itself in as far as public finances are concerned as we get closer to the ​budget,” Fiona Cincotta said.
  • Investors were also closely monitoring developments in the Middle East, with Brent crude prices remaining around $95 a barrel.
  • Telecoms firm Vodafone opened a new tab, climbing 2.1% following an upgrade from Goldman Sachs, which changed its rating from ‘sell’ to ‘buy’.
  • Oxford Nanopore Technologies slid 5.9% after healthcare investor Novo Holdings sold 49 million shares of the biotech firm for £74 million ($100.07 million).
  • Attention is directed toward U.S. jobs data for insights regarding the Federal Reserve’s policy trajectory.