U.K. stocks dropped Wednesday, with the blue-chip market’s six-day winning streak coming to an end after elevated U.S. bond yields triggered a selloff on Wall Street and pressured equity markets world-wide. But Sky PLC was a standout after receiving a more than £20 billion takeover bid from Comcast Corp.TheFTSE 100 index fell 0.6% to end at 7,379.32, falling from an 11-week closing high hit on Tuesday. Also on Tuesday, the benchmark logged its longest winning streak since mid-May 2017, up six days in a row. The
pound bought $1.3943, down from $1.3978 late Tuesday in New York. In the fixed-income market, the yield on the 10-year gilt rose less than 1 basis point to 1.54%, according to Tradeweb. But that yield has been moving around two-month highs. U.K., European and Asian stock markets took their cues from a slide in U.S. stocks on Tuesday, and U.S. stocks extended losses during Wednesday’s session. U.S. stocks were hit after the U.S. 10-year Treasury yield climbed to the psychologically important 3% level for the first time in four years on Tuesday, and that yield held above 3% on Wednesday. U.S. bond yields have been rising on expectations that inflationary pressures could prompt the Federal Reserve to ramp up the pace of rate increases, which would increase borrowing costs for companies and consumers. U.K. and European bond yields have also been creeping upward. Higher yields can weigh on stocks as bonds start to offer better returns than equities. Investors in the U.K. and Europe will tune into what the European Central Bank will say about economic growth in the eurozone on Thursday when the bank releases its monetary policy decision. Sky PLC shares jumped 3.9%, and rose as much as 7.2% to $14.02, after Comcast Corp. offered to buy the British pay-TV operator. The bid of £12.50 a share—or £22 billion ($31 billion) —is a 16% premium to an offer from 21st Century Fox’s Inc. which already owns a 39% stake in Sky. Sky said it was withdrawing previous pact agreeing to a takeover by Fox. Antofagasta PLC fell 1.8% after the miner said first-
quarter copper production fell 10.5% due to lower grades, but that guidance for the year is unchanged Lloyds Banking Group PLC shares fell 1.7% even as the lender posted a 23% rise in first-quarter pretax profit. Shire PLC shares fell 2.8%, but had traded higher early Wednesday after the drug maker recommended shareholders accept an improved takeover bid from Takeda Pharmaceutical Co. Whitbread PLC shares turned lower, losing 0.2% after the company said it would spin off Costa Coffee into a separate business. Whitbread said it would remain the owner and operator of its Premier Inn hotel business.
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