UK 30-year gilt yields hit highest since 1998 as European stocks open Q4 lower

European stocks opened the fourth quarter lower on October 1 as government bond yields across the region climbed to multi-year highs. UK 30-year gilt yields rose to levels last seen in 1998, and the FTSE 100 slid alongside broader European indexes. Higher long-term borrowing costs raise the price governments pay to finance debt and tend to pressure equity valuations, particularly for rate-sensitive sectors. The move came as investors awaited France's budget, a potential flashpoint given the country's fiscal strains. Not every data point pointed the same direction: manufacturing PMIs improved in Spain, the Netherlands and the Czech Republic during the same period, suggesting the bond-driven equity weakness is not yet showing up in the real economy.