Uk and European stocks are higher this morning after global stocks followed Wall Street lower on Tuesday as rates continued climbing. Large US tech names, including Facebook and Microsoft were hit particularly hard as the benchmark 10-year Treasury yield hit a 3-month high of 1.567% raising concerns that the Fed could begin tapering its asset purchasing program sooner than expected. Asian stocks fell with Japan down more than 2%.
Sentiment wasn’t helped by comments from US Fed chairman, Jerome Powell, who said inflation could persist longer than expected. Powell, along with Andrew Bailey, Governor of the Bank of England will be speaking today at the ECB Forum on Central Banking. On Monday, Bailey said interest rates could rise before the end of the year. The UK 10-year government bond yield reached 1% on Tuesday for the first time in more than two years.
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