The FTSE 100 plunged after Andy Burnham’s campaign to return to Westminster triggered turmoil in bond markets, with borrowing costs pushed to their highest level in 28 years. The Telegraph has more.
Britain’s flagship stock market fell 1.7% – the biggest drop since the first weeks of the Iran war – as UK Government borrowing costs rose to their highest level since 1998 in the wake of Mr Burnham’s leadership push.
Bank stocks dropped by more than 2% over concerns of potential taxes on profits while utility company shares plummeted by as much as 7.6% over fears they could be nationalised.
UK Government bonds have come under pressure since Burnham took the first steps on his path towards a leadership contest to replace Sir Keir Starmer.
The yield on 30-year gilts, which shows the return the Treasury must pay when borrowing from financial markets, has leapt from 5.65% to a 28-year high of 5.85%.
Meanwhile, the benchmark yield on 10-year gilts, as UK government bonds are known, rose to 5.17% – the highest point since 2008.
The Labour leadership drama has put the pound on track for its worst week since the aftermath of Rachel Reeves’s first budget in November 2024, falling by more than 2%.
Modupe Adegbembo, an economist at Jefferies, said: “Political developments now present a clear headwind for UK assets.”
Burnham’s leadership gambit has raised concerns in financial markets that he will push up borrowing and leave the public finances on an unsustainable footing.
He has previously said that the Government was “in hock” to the bond markets and has suggested putting defence spending outside the Chancellor’s fiscal rules.
Worth reading in full.
The Telegraph notes that Burnham’s agenda suggests he is “set to rip up Labour’s manifesto pledges on tax and spending if he seizes power from Sir Keir Starmer”.
The Mayor of Greater Manchester has said he wants to increase income tax and tweak the Chancellor’s “non-negotiable” fiscal rules as part of a policy blitz that would breach two of Labour’s core commitments from 2024.
He has also said in recent months that he would ultimately like Britain to rejoin the European Union, despite Labour vowing to “make Brexit work” at the last General Election.
The clashes will raise concerns that Burnham will abandon Sir Keir’s agenda and plough his own furrow if he wins the keys to Downing Street, betraying the public’s decision at the ballot box two years ago.
An ally of Sir Keir Starmer said there would have to be an immediate general election if Burnham took over as leader, while the Tories insisted he would have “no mandate to enact his fantasy manifesto” if he won the race for No. 10.
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All Labours candidates for leader are far left nutters who will be watching the YooKay gurgle down the plug hole.
That’s OK – King O’The North – or is it Cock – says the Bond markets are irrelevant and don’t matter.
Well, in searching for a reason for the former Royal Marines Special Forces officer Alistair Carns’ betrayal of his Brothers-in-Arms, the answer seems connected to the above DS summary article on Andy Burnham, because of the following excellent new article by Rhoda Wilson:
Andy Burnham or Keir Starmer makes no difference; they are both Fabians – The Expose
And so is Alistair Carns, reportedly. It also explains the Uniparty, in which nothing seems to change regardless of which party is in power, because the Fabians & World Economic Forum control the civil service in all western governments.
“Between the Fabian Society and the World Economic Forum, we have a global hydra of wolves at the helm of virtually every government. Swift global mandates, under these circumstances, would be superfluous and readily-executable.
After all, even the WEF admitted that the recent Covid-19 lockdowns constituted the “world’s biggest psychological experiment”. And governments still aren’t questioning the rationale behind this hysterics-driven farce that has tipped their nations towards bankruptcy. Instead, they are digging deeper holes for themselves and their nations.” (Dr. Matthew Maavak)
Then there is this other article by Rhoda Wilson:
Who’s keeping Starmer in office? A Bloomberg interview may hold some… Read more »
Eh… the bond and stock markets have had a bad day everywhere.
I’m pretty sure Andy Burnham isn’t the cause of the drop in the S&P and the rise in US treasury yields.
Yeah, I thought the same… 2% drop in gold because of a Labour minster?
My S&P stocks are up 3pc this week, drop?
It dropped on Friday. Apparently because Burnham decided to challenge Starmer…
Shh, might be Iran debacle effects….
I wonder if Streeting really wants labour to win Makerfield, or not.
Has the relevant electorate been told by Labour how it is going to vote? If so, Reform could not wish for more. The very act of Burnham standing clearly signals that the Labour vote is taken for granted and nothing is more likely to give it a good drubbing than that. Never tell the English how they are going to vote.
Burnham is standing in the Makerfield by-election. The result in 2024 was:-
Labour 18,202
Reform 12,803
Conservative 4,379
Lib Dem 2,735
Green 1,776
The turnout for a by-election may be different than in a general but presumably this won’t have much effect on the share of the vote each party gets.
Labour are almost certain to loose thousands of votes to the Greens but I doubt Reform will gain many votes from the Conservatives, they might even loose a small number to them. This means Reform will may only need to pick up about 1,500 votes from people who voted Labour in 2024 to win, which seems entirely plausible so there’s a fairly good chance Burnham won’t be elected and able to stand in the Labour leadership election.
Ironic how Makerfield’s red wall and green dyke stand between the country and a far-left Prime Minister not even voted for by the 20% of the electorate gullible enough to vote Labour in the 2024 general election.
I don’t know how the possible leadership candidates differ from each other or Starmer. Tbh I don’t care who wins, it’ll pretty much be the same shit in a different suit.
I think it can actually get worse than Starmer under the overrated Burnham.
Starmer will go scorched earth on Britain. He really can’t forgive us for not loving him.
Whut? So worse than Liz Truss? We’re doomed!