Stocks poised for worst slump in two years as oil prices surge

US oil prices have topped $95 for the first time in a year
US oil prices have topped $95 for the first time in a year - FREDERIC J. BROWN/AFP via Getty Images

World stocks were on track for their longest losing streak in two years as the sight of oil prices heading for $100 a barrel compounded worries that interest rates will stay higher for longer.

The MSCI’s main global equities index which tracks 45 countries was on course for its 10th straight daily fall, a losing streak not seen since 2021.

The CAC 40 in Paris has fallen 4.2pc during that period while the Dax in Frankfurt has dropped 4.5pc.

The Dow Jones Industrial Average on Wall Street has dropped 3.6pc over the last 10 days, with the S&P 500 dropping 4.8pc and the Nasdaq Composite falling 5.5pc.

The FTSE 100 has fallen 2.1pc during that time, having been insulated from the drops because of its large number of energy companies.

US-produced West Texas Intermediate crude hit $95 a barrel for the first time since August last year while global benchmark Brent hit a one-year high of $97.69. The increase in prices has been driven by cuts to supplies by Saudi Arabia and Russia.

Marija Veitmane, head of equity research at State Street Global Markets, said the UK market “has a very large concentration of energy companies”.

He said: “Oil supply will stay tight for some time, that will support oil price and so that’s great for UK stocks in a relative sense.”

Read the latest updates below.


05:48 PM BST

FTSE in green but higher gilt yields drag down housebuilder shares

The FTSE 100 closed marginally higher but struggled against its European counterparts as housebuilder shares were brought down by gilt yields.

The biggest faller on the FTSE 100 was Britain’s biggest housebuilder Barratt Developments, down 35.7p to 432.7p.

Gilt yields rose amid concerns that interest rates could remain high for a longer period of time.

The FTSE 100 moved 0.11%, or 8.63 points, higher to finish at 7,601.85.

Michael Hewson, chief market analyst at CMC Markets, UK, said: “There’s been a slightly more positive bias for markets in Europe today although the FTSE 100 is underperforming a touch with housebuilders getting hit on the back of a surge in gilt yields across the board.”

The biggest risers on the FTSE 100 were Smiths Group, up 52p to 1,622p, Anglo American, up 71p to 2,267p and Antofagasta, up 35.5p to 1,417.5p.


04:30 PM BST

UK bonds slump as traders bet on Bank of England rate hike

UK Government bonds slumped as traders have added to bets that Threadneedle Street will keep interest rates high.

The yield on 10-year gilts rose by as much as 20 basis points to 4.56pc today.

Traders are expecting a quarter-point hike in this cycle with markets expecting The Bank of England to maintain the key rate at above 4pc in coming years.