London midcaps lead losses as rising gilt yields weigh; Reckitt gains

Reckitt Benckiser

01/09/2026 17:13

FTSE 100 at two week low, FTSE 250 to mark worst day since March
Banks, housing stocks drop as 10-year gilt yields hit 2008 high 
Markets priced in more BoE tightening by year-end 
Reckitt up on favourable U.S. court ruling
Updates to markets close
Sept 1 (Reuters) - London's midcap FTSE index on Tuesday logged its biggest one-day drop since March as Middle East tensions pushed up global bond yields on inflation concerns, while Reckitt Benckiser gained after a favourable U.S. court ruling.
The export-focused FTSE 100 index .FTSE closed 0.32% lower at 10,789 points while the domestically focused FTSE 250 .FTMC declined 1.67%.
The United States and Iran traded fresh fire, sending Brent crude LCOc1 prices up to over $92 a barrel and sparking a bond selloff globally as investors mulled the repercussions on the world economy.
The yield on the UK 10-year Gilt GB10YT=RR hit its highest since 2008. Investors now see the Bank of England hiking interest rates by at least 31 basis points by year end — up from around 24 bps last week — LSEG-compiled data showed. 
Rate-sensitive sectors were especially hit: Financial stocks such as Barclays BARC.L fell 2.1%, Aberdeen ABDN.L dropped 2.86% and Prudential PRU.L lost 1.7%.
Housing goods and home construction .FTNMX402020 fell 2.3%, while precious metal miners .FTNMX551030 tanked 5.4% and led sectoral losses on lower bullion prices.
On the data front, house prices rose in August, mortgage lender Nationwide said, reflecting demand held up despite an uncertain economic outlook.
Manufacturing activity slowed slightly in August to its weakest since March, S&P Global said.
Bucking broader weakness, Reckitt Benckiser RKT.L added 4.4% after a U.S. jury favoured the company in its trial over claims that it failed to warn that its products for premature babies could cause a deadly bowel disease.
Energy stocks BP BP.L and Shell SHEL.L rose 5.2% and 2.6%, respectively, tracking higher crude prices. O/R
Oxford BioMedica OXB.L tumbled 14.7% after Novartis NOVN.S and Bristol-Myers Squibb BMY.N, both having ties with the company, paused clinical trials of CAR-T treatment for autoimmune disorders.
Bodycote BOY.L jumped 4.6% after U.S.-based private equity firm Veritas Capital agreed to buy the thermal processing services company in a £1.85 billion ($2.51 billion) deal.
 ($1 = 0.7390 pounds)

 (Reporting by Anand Gopal and Johann M Cherian in Bengaluru; Editing by Nivedita Bhattacharjee and Joyjeet Das)
 ((AnandGopal.R@thomsonreuters.com))