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Stocks today: Inflation falls but rate hike fears continue

By Indrabati Lahiri

11:02, 20 October 2021

Markets moving lower
Inflation remains above Bank of England’s 2% target rate – Photo: Shutterstock

UK stocks inched lower on Wednesday morning, after a dip in inflation failed to quench interest-rate hike speculation.

Persisting inflation concerns were backed up by increases in input prices for many sectors, such as machinery and metal production.

European stocks reflected similar sentiment with the Euro Stoxx 50 also inching lower amid conflict between European banks and the EU to extend access to clearing houses in the City of London following Brexit.


18,361.50 Price
-0.660% 1D Chg, %
Long position overnight fee -0.0228%
Short position overnight fee 0.0009%
Overnight fee time 21:00 (UTC)
Spread 30.5


15,916.60 Price
-0.210% 1D Chg, %
Long position overnight fee -0.0200%
Short position overnight fee -0.0022%
Overnight fee time 21:00 (UTC)
Spread 3.0


14,368.20 Price
0.000% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 3.0


4,206.10 Price
-0.300% 1D Chg, %
Long position overnight fee -0.0255%
Short position overnight fee 0.0032%
Overnight fee time 21:00 (UTC)
Spread 1.7

Why are markets down today?

Mining stocks and commodities, including aluminium and coal, moved lower as major mines in Chile faced disruptions due to ongoing droughts.

Meanwhile, widespread market anxieties about the Bank of England potentially raising interest rates before the end of the year drove UK bond yields higher.

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Market highlights

  • The FTSE 100 lost 0.11% on Wednesday morning, as interest rate hike fears continued, before recovering slightly by lunchtime.
  • The Euro Stoxx 50 also edged lower by 0.47% before recovering to gain 0.13%.
  • Brent crude oil traded at $84.24, dropping 0.99% but still remaining close to multi-year highs

Market sentiment: The fear-greed equation

  • The CBOE Volatility Index or VIX, a measure of volatility in US stocks and reflecting investor anxieties, fell 3.9% to 15.67.
  • The US dollar index broke a five-session losing streak, gaining 0.1% to $93.85, reflecting a rise in the demand for safe-haven assets
  • The US 10-year bond yield index also gained and stood at $1.648, as rate hike fears worsened

Top stock gainers UK and Europe

  • In UK, the best performing sectors were utilities, consumer non-durables and consumer services
  • SSE, Burberry Group and Entain led gains in their respective segments
  • In Europe, the top gainers were investment, medical equipment and electric
  • Prosus, Philips and Iberdrola were the best performing companies in their respective sectors

Top stock losers UK and Europe

Top news: Need to know

  • Banking giant Credit Suisse, which has been grappling with a bribery and corruption case in Mozambique, has agreed to pay $475 million in charges
  • Burberry has appointed former Versace boss Jonathan Akeroyd as new CEO
  • Mercedes-Benz has opened a new tech centre in China, as the company bulks up spending on design and technology
  • Apple has announced new MacBook Pro laptops with Apple’s own new M1 processor chips

Read more: UK inflation dips unexpectedly in September

Markets in this article

13.770 USD
-0.225 -1.620%
13.770 USD
-0.225 -1.620%
13.770 USD
-0.225 -1.620%
Oil - Brent
Brent Oil
73.83 USD
-3.29 -4.270%
22.14 USD
0.16 +0.730%

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