By Steve Goldstein
U.K. stocks on Thursday saw a mixed reaction to the surprisingly hawkish tone from the U.S. Federal Reserve.
The FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +1.12% fell 0.6%, after the Fed’s summary of economic projections showed two interest rate increases in 2023 and the central bank said that it has begun discussing when to slow down the rate of bond purchases.
With metals prices reacting to the rise in bond yields — gold futures /zigman2/quotes/210034565/delayed GC00 -0.16% fell $63 an ounce — shares of metals producers including Rio Tinto /zigman2/quotes/208934945/delayed UK:RIO -0.15% and Anglo American /zigman2/quotes/201381512/delayed UK:AAL +0.14% fell.
But banks including HSBC Holdings /zigman2/quotes/203901799/delayed UK:HSBA -0.54% , Standard Chartered /zigman2/quotes/200125072/delayed UK:STAN -0.24% and Barclays /zigman2/quotes/208409333/delayed UK:BARC +0.06% advanced on the news. Bank shares tend to rise when bond yields increase, as investors hope for improving margins.
Premier Inn operator Whitbread /zigman2/quotes/207954631/delayed UK:WTB +1.91% rose 3%, after reiterating its outlook for the year, following a fiscal first quarter in which like-for-like sales were 71% below two years ago.