Branch2 Intelligence
Mid-caps shine but AB Foods holds back FTSE 100
Key takeaway
Associated British Foods (ABF) shares fell, dragging FTSE 100, as US rate hike concerns resurface.
- Step 11st-order: US rate hike concerns lift US term premium and 10Y UST yields.
- Step 22nd-order: Higher US term premium transmits to UK gilt yields and SME lending spreads via cointegrated long-rate markets.
- Step 33rd-order: UK households face higher mortgage and financing costs, deferring discretionary spend on apparel and home goods, hitting Primark's like-for-like sales.
Source: The Independent Business
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