FTSE Falls Amid Bond Yield Fears and Oil Price Volatility

The FTSE 100 index closed down 0.4% at 10,658.13 on Tuesday, as high bond yields and fears of higher interest rates kept buyers on the sidelines.

Oil prices remained elevated amid ongoing tensions in the US-Iran conflict, with Brent oil trading at USD108.48 a barrel in London.

The yield on the US 10-year Treasury reached a 19-year high of 5.02%, while the UK's 10-year gilt yield hit 5.41%.

Market analysts expect the Federal Reserve to raise interest rates on Wednesday, with Morgan Stanley shifting its stance to predict a quarter-point rate increase.