LONDON
The FTSE 100 closed 11 points lower at 10,811.66 on Tuesday as investors grappled with rising UK borrowing costs and oil approaching $100 a barrel.
The 30-year gilt yield broke above 6 percent following the UK Debt Management Office's £4.25 billion sale of 30-year gilts. The move reflects the market's demand for greater compensation on longer-duration bonds, signaling both inflation expectations and increased duration risk for fixed-income portfolios.
Middle East tensions pushed crude toward $100 per barrel, rekindling inflation concerns. Copper strengthened on supply worries, providing some support to equities.
Wall Street opened with caution: the Dow Jones Industrial Average fell 0.57 percent, the S&P 500 slipped 0.01 percent, and the Nasdaq Composite edged 0.08 percent higher. Investors assessed the economic impact of elevated energy costs ahead of U.S. inflation data due later in the week.
Technology stocks provided a counter-balance, with Intel and Nvidia recording pre-market gains on continued AI sector optimism.
Institutional money managers are tracking the yield curve spread between short-term and long-term gilts. A widening spread typically signals growth concerns or persistent inflation pressures—both critical inputs for duration positioning.
