Stocks in London closed lower on Thursday as investors remained cautious, reacting to a mix of global events and economic indicators. The FTSE 100 index dropped 0.2% to 10,679.99, while the FTSE 250 fell 0.9% to 24,154.32. European markets also saw declines, with the CAC 40 in Paris down 0.5% and the DAX 40 in Frankfurt falling 0.6%. In the U.S., the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all closed in the red, with losses ranging from 0.5% to 0.8%. Kathleen Brooks, a research director at XTB, noted that markets are currently without a clear direction, with several unresolved issues contributing to uncertainty. These include concerns over a potential bond market crisis, tensions in the Middle East involving Iran, oil supply routes through the Strait of Hormuz, and the ongoing conflict in Ukraine affecting Russian infrastructure. Such factors have led to continued fluctuations in both commodity and bond markets. During the U.S.-China summit, President Donald Trump and President Xi Jinping agreed to extend their trade truce for two months. However, they remain divided over China’s support for Iran. Trump described their progress as “tremendous,” while Xi emphasized the need to develop artificial intelligence “under human control” and improve bilateral communication. Meanwhile, higher oil prices and rising bond yields have tempered investor optimism. The yield on the U.S. 10-year Treasury rose to 5.11%, and the 30-year yield climbed to 5.45%. Analysts attribute this to a strong U.S. economy and high manufacturing output data. In the UK, the government is considering reducing its fiscal buffer in the upcoming budget to avoid sharp tax increases or spending cuts. Reports suggest that Chancellor John Healey might aim for a smaller buffer than the £23.6 billion forecast by the Office for Budget Responsibility. Some analysts believe the buffer could fall to around £14 billion without causing a major market reaction, though others warn that going below £20 billion might shake investor confidence. On the FTSE 100, energy stocks like BP and Shell rose due to higher oil prices, while JD Sports Fashion gained after considering its results. However, some companies like Standard Life and Computacenter fell as they traded ex-dividend. On the FTSE 250, Raspberry Pi surged 20% after reporting strong first-half results, while Vistry saw a mixed performance as it evaluated its turnaround strategy. Gold prices also declined slightly, ending the day at $4,252.84 per ounce. Friday’s market schedule includes corporate earnings reports and key economic data from around the world.