London Stocks Dip Amid U.S. Inflation Worries and Bond Yield Pressure

London stocks opened lower on Wednesday due to higher U.S. bond yields and fresh data spurring inflation concerns. The FTSE 100 dipped 0.1%, marking a three-week low, while mid-cap FTSE 250 remained flat. Key focuses include U.S. PCE data and a speech by Bank of England Governor Andrew Bailey.

London stocks opened lower on Wednesday after higher U.S. bond yields pressured equities globally, while fresh U.S. data reignited inflation worries and cast doubts about the timing of rate cuts by the Federal Reserve.

As of 0707 GMT, the blue-chip FTSE 100 was down 0.1% at 8,243.98 points, trading at a three-week low. The index is bound for the longest losing streak since August 2023. The mid-cap FTSE 250 was trading flat.

The U.S. 10-year Treasury yields rose as high as 4.556%, pressuring equities after data showed a sharp improvement in U.S. consumer confidence measure for May that suggested sticky inflation would keep rates higher for longer. All eyes are now pinned on the Fed's preferred inflation gauge - the Personal Consumption Expenditures (PCE) price index data - due on Friday. The Bank of England Governor Andrew Bailey's speech on Thursday will also be monitored closely.

Among stocks, International Distributions Services gained 3.1% after the Royal Mail owner agreed to a 3.57-billion-pound ($4.55 billion) takeover offer by Czech billionaire Daniel Kretinsky. Shares of Fresnillo PLC were the top gainers in the FTSE 100 with a 2.5% jump after RBC upgraded the stock to "outperform" from "sector perform".