FTSE 100 Falls as Bond Yields and Oil Prices Pressure Stocks

London’s FTSE 100 dropped more than 1.5% to around 10,420 points in the first trading session of the fourth quarter, touching its lowest level since June as elevated bond yields continued to weigh on equities. The decline came despite softer-than-expected US PCE inflation data, which reduced expectations of a Federal Reserve rate hike this month. However, rising oil prices, as investors weighed signs of increased Middle East energy flows against the ongoing impasse in US-Iran negotiations, added to inflation concerns and expectations that monetary policy could remain tighter for longer. On the domestic front, UK house prices fell 0.2% in September from the previous month, according to Nationwide. Annual house-price growth also slowed to 0.8%, marking its weakest pace of the year.