LONDON—Global stocks and bonds fell on Tuesday as a surprise policy tweak by Japan’s central bank rattled investors already worried about the economic fallout of rising interest rates and lifted domestic bond yields to seven-year highs.
The Bank of Japan (BOJ) widened the allowable band for long-term yields to 50 basis points on either side of its 0 percent target, from 25 basis points previously.
European stock markets hit six-week lows, with the German and French benchmark indices falling by as much as 1 percent, while London’s FTSE 100 lost as much as 0.8 percent.
Japanese 10-year government bond yields surged to their highest since 2014, with eurozone yields following suit. Yields rise when bond prices fall….