The FTSE 100 shrugged off early falls to close higher on Wednesday after the US Treasury said it plans to boost buybacks of longer-dated bonds.
The FTSE 100 index closed up 15.31 points, 0.1%, at 10,743.35. The FTSE 250 ended up 82.09 points, 0.3%, at 24,643.52, and the AIM All-Share closed up 7.29 points, 0.9%, at 801.54.
The move by the US Treasury came after yields on the 30-year US bond reached a 19-year peak on Tuesday, with bond yields across the globe also pushing higher.
The Treasury will increase “by at least double” bond buybacks, reflecting a “desire to provide greater liquidity support in longer-dated” bonds, it said on Wednesday.
The operations include the 10-year to 20-year sector and the 20-year to 30-year sector. The current maximum size of two billion dollars per operation will be at least four billion dollars per operation, it added.
In response, the yield on the US 10-year Treasury narrowed to 4.66% on Wednesday from 4.72% at the time of the London equity close on Tuesday. The yield on the US 30-year Treasury fell to 5.20% from 5.30%.
In London, the yield on 10-year gilts ebbed to 5.05% from 5.08%, and the yield on the 30-year fell to 5.79% from 5.85%.
Stocks in New York were higher. The Dow Jones Industrial Average was up 0.4%, the S&P 500 index was 0.5% higher, while the Nasdaq Composite gained 0.4%.
On Wall Street, Moderna shares more than doubled, and Merck jumped 11%, after announcing encouraging results from a trial of their experimental vaccine against melanoma.
The vaccine, called intismeran autogene, showed “statistically significant and clinically meaningful improvements” for skin cancer patients when used with Merck’s Keytruda treatment, the companies said in a statement.
JPMorgan analyst Chris Schott noted the companies believe the vaccine could be approved by the US Food & Drug Administration as early as 2027.
He said the positive interim read of intismeran autogene adds another potential “multi-billion” product for Merck with more detailed data on the drug due in the autumn.
In Europe on Wednesday, the CAC 40 in Paris closed down 0.1%, as did the DAX 40 in Frankfurt.
Back in London, investors weighed broadly in-line inflation figures although core data surprised to the upside.
The Office for National Statistics said on Wednesday that the Consumer Price Index rose 2.9% in the 12 months to July, accelerating from 2.6% in June.
The figure was in line with the FXStreet-cited consensus, but ahead of the 2.8% forecast in July’s Bank of England monetary policy report.
Barclays analyst Jack Meaning said the acceleration was driven by increased energy and core goods inflation, offset by weakening services and food inflation.
Energy inflation picked up to 9.8% on-year in July from 5.7% in June, after industry regulator Ofgem increased the price cap starting July 1.
The core consumer price inflation rate, which excludes energy, food, alcohol and tobacco, was unchanged at 2.6% in the year to July.
Overall, Mr Meaning at Barclays does not expect the print will alter the current inflation outlook of the Bank Of England’s Monetary Policy Committee.
“With the labour market data continuing to look soft, the key risk to the outlook continues to come from developments in the Middle East escalating, rather than domestic dynamics,” he added.
Reflecting the domestic data and the US Treasury moves, the pound traded at 1.3608 dollars on Wednesday afternoon, up from 1.3539 dollars at the equities close on Tuesday. Against the euro, sterling fell to 1.1669 euros from 1.1693 euros.
The euro stood higher at 1.1662 dollars against 1.1578 dollars. Against the yen, the dollar was lower at 158.46 yen, compared with 159.62 yen.
Oil prices remained elevated as the prospect of any Middle East deal dimmed after US President Donald Trump said he would not extend a 60-day truce with Iran.
Brent oil for October delivery traded at 92.40 dollars a barrel on Wednesday afternoon, up from 91.17 dollars late Tuesday.
On the FTSE 100, gold miners surged as the weak dollar helped boost the price of the yellow metal.
Gold traded at 4,483.13 dollars an ounce on Wednesday, up from 4,361.38 dollars on Tuesday. While the price of silver climbed 3.5%.
Fresnillo and Endeavour Mining rose 7.8% and 7.5% respectively on the FTSE 100, while on the FTSE 250 Hochschild Mining jumped 8.0%.
Elsewhere, JD Sports Fashion rose 2.1% ahead of Thursday’s trading statement but IG Group’s recent woes continued with shares marked down 4.4% as the market assesses its recent 1.3 billion dollar acquisition of Underdog.
UBS, which slashed its price target for IG to 1,700p from 2,200p on Wednesday, thinks the market is concerned about risks associated with Underdog and the reasons for the deal.
The broker said the Underdog deal is “not without risk but the structure of consideration and management incentive payments helps protect shareholders to the downside whilst actively encouraging outperformance”.
On the FTSE 250, Oxford Nanopore jumped 14% as it said improved cost control helped it deliver a narrower loss than the market expected.
The Oxford-based specialist in DNA and RNA sequencing technologies said its pre-tax loss shrank to £44.9 million in the six months ended June 30 from £69.0 million the year prior.
Adjusted loss before interest, tax, depreciation and amortisation narrowed to £22.1 million from £48.3 million a year ago, beating market consensus for a £38.1 million loss.
The firm said improvement was driven by gross profit growth and disciplined cost control, with adjusted operating costs down 6.9% year-on-year and down 9.6% versus the second half of 2025.
“We view the better-than-expected progress on narrowing Ebitda loss as a meaningful confidence boost for the market in Oxford Nanopore’s ability to break even next year,” said Citigroup analyst Veronika Dubajova.
But Trainline plunged 14% after the UK Competition and Markets Authority (CMA) announced an investigation into drip pricing.
The CMA said its investigation will focus on concerns that customers are not shown the total price upfront when buying train and coach tickets.
“The investigation is likely to weigh on the shares until it is resolved,” analysts at Stifel said.
The biggest risers on the FTSE 100 were Fresnillo, up 224.00p at 3,085.00p, Endeavour Mining, up 307.00p at 4,405.00p, Croda, up 163.00p at 3,270.00p, Glencore, up 28.90p at 580.10p and Anglo American, up 184.00p at 4,015.00p.
The biggest fallers on the FTSE 100 were IG Group, down 67.00p at 1,318.00p, Smith & Nephew, down 42.00p at 1,068.50p, BAE Systems, down 65.00p at 2,160.00p, National Grid, down 32.00p at 1,179.00p and Aviva, down 17.60p at 719.40p.
Thursday’s global economic calendar has Australia unemployment figures and an interest rate decision in China overnight, PPI data in Canada, plus the Philadelphia Fed manufacturing index and weekly jobless claims numbers in the US.
Thursday’s UK corporate calendar has a trading statement from sports retailer JD Sports Fashion and full-year results from recruiter Hays.
Contributed by Alliance News
