London midday: Bond sell-off and Greek uncertainty hammer stock markets

UK stocks dropped sharply on Tuesday as a sell-off on sovereign debt markets and ongoing fears about Greece's finances hammered sentiment.The FTSE 100 was down 1.63% at 6,915.17 by midday, with Easyjet leading the decline with a 10% share-price fall following its interim results.The Footsie hit an intraday low of 6,887.52 in morning trade despite some better-than-expected UK economic data.British industrial production unexpectedly grew by 0.5% in March after 0.1% growth in February, surprising analysts who expected output to come to a standstill. The year-on-year rate of growth picked up to 0.7% from 0.1%.Nevertheless, surging bond yields across Europe triggered a drop on equity markets in morning trade, though Oanda analyst Craig Erlam said the downwards pressure on bonds was "not entirely surprising"."The recent recovery in oil prices has lifted the inflation outlook which in turn is pushing yields higher. Given how many bonds were offering negative returns in Europe, there was plenty of scope for upside moves if we saw this kind of rebound in oil prices," Erlam said.The yield on a 10-year German bund rose as much as 14 basis points to 0.72% on Tuesday morning, while borrowing costs gained by similar amounts in the UK, France, Italy and Spain.Greek 10-year bond yields, meanwhile, rose 13 basis points to 10.68% amid reports that the International Monetary Fund does not want to participate in a third bailout for the country.The news came just a day after Greek finance minister Yanis Varoufakis admitted that Athens' liquidity problem is a "terribly urgent issue", saying that the country could run out of cash in "the next couple of weeks".If that wasn't enough, concerns about a UK referendum on EU membership were also weighing on stocks after David Cameron suggested that the vote could be brought forward to 2016 from the expected 2017.Stock futures on Wall Street were also trading firmly in the red ahead of the opening bell.Easyjet disappoints with outlookBudget airline Easyjet met guidance after swinging to a small profit in the first half, though it faces tougher conditions in the latter part of the year. The company saw shares sink after saying that exchange-rate movements and air traffic control strikes in France are expected to hit second-half results.A host of financial stocks were also providing a drag, including Hargreaves Lansdown, London Stock Exchange, Prudential, Admiral and Aberdeen Asset Management.Credit-checking outfit Experian was among the few risers on the FTSE 100 after returning to organic revenue growth in the fourth quarter. For the full year, total revenue from continuing activities grew 1% to $4.81bn, with profit before tax slightly above flat at $751m.Insurer Hiscox declined after underwhelming with gross premiums growth of 12% to £561.7m in the first quarter.Pubs group Enterprise Inns impressed the market with plans to increase direct management of pubs and grow its commercial property business, as it unveiled first-half results that met targets.Thomas Cook Group was given a boost after Credit Suisse said it sees an attractive risk-reward balance at the tour operator as it upgraded its rating from 'neutral' to 'outperform'.Market MoverstechMARK 3,211.24 -1.68%FTSE 100 6,915.17 -1.63%FTSE 250 17,630.46 -1.34%FTSE 100 - RisersLloyds Banking Group (LLOY) 87.72p +1.29%Fresnillo (FRES) 710.50p +1.28%Experian (EXPN) 1,189.00p +1.02%Randgold Resources Ltd. (RRS) 4,743.00p +0.89%BHP Billiton (BLT) 1,579.00p +0.45%FTSE 100 - FallerseasyJet (EZJ) 1,655.00p -9.71%Hargreaves Lansdown (HL.) 1,191.00p -3.56%London Stock Exchange Group (LSE) 2,448.00p -3.51%Prudential (PRU) 1,595.50p -3.16%Admiral Group (ADM) 1,461.00p -3.12%Aberdeen Asset Management (ADN) 436.00p -3.11%St James's Place (STJ) 914.00p -2.82%AstraZeneca (AZN) 4,404.50p -2.73%Ashtead Group (AHT) 1,145.00p -2.72%Aviva (AV.) 526.50p -2.68%FTSE 250 - RisersThomas Cook Group (TCG) 158.40p +3.53%Just Eat (JE.) 448.90p +1.61%Amec Foster Wheeler (AMFW) 883.00p +1.55%Redrow (RDW) 408.00p +1.42%Premier Oil (PMO) 181.80p +1.39%Kaz Minerals (KAZ) 257.40p +1.22%Ocado Group (OCDO) 386.40p +1.10%Spirit Pub Company (SPRT) 112.80p +0.98%Enterprise Inns (ETI) 133.70p +0.98%Wood Group (John) (WG.) 698.00p +0.94%FTSE 250 - FallersRegus (RGU) 246.80p -6.09%Indivior (INDV) 228.60p -4.67%Man Group (EMG) 175.50p -3.89%AL Noor Hospitals Group (ANH) 835.50p -3.80%COLT Group SA (COLT) 152.80p -3.35%Provident Financial (PFG) 3,020.00p -3.24%Investec (INVP) 591.00p -2.96%Hiscox Limited (CDI) (HSX) 794.00p -2.93%Genus (GNS) 1,369.00p -2.91%Essentra (ESNT) 974.00p -2.89%