June 25 (Reuters) – UK gilt futures tracked Bunds lower on Friday, pulling back from a rally on the back of this week’s budget after share prices showed signs of breaking a three-day losing streak.
* Falls despite a downbeat BoE half-yearly Financial Stability Report, which warns that UK recovery may be hurt next year by constrained lending as banks face refinancing pressures [nLAG006321]
* Sept gilt future FLGU0 drops 12 ticks to 120.57 versus 23 tick fall on Bund future FGBLU0 by 0728 GMT after London share prices rise by 0.5 percent .FTSE
* Gilt technical support seen at Wednesday low and Thursday close of 120.13, with resistance at 121.80 the breakout of a month-long ascending triangle pattern, according to Nomura
* Ten-year gilt yield at 3.40 percent, flat on day, after setting eight-month low on Thursday
* Spread versus 10-year Bund EU10YT=RR at 79 basis points, little changed from late Thursday
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