💎 Fed’s first rate cut since 2020 set to trigger market. Find undervalued gems with Fair ValueSee Undervalued Stocks

Banks lead FTSE higher, BoE holds rates and QE

Published 12/09/2010, 07:43 AM
Updated 12/09/2010, 07:44 AM

* FTSE 100 up 0.3 percent, BoE keeps rates at 0.5 percent, holds QE

* Banks, miners gain, U.S. fiscal stimulus boosts confidence

* Standard Chartered retreats after trading update

By David Brett

LONDON, Dec 9 (Reuters) - Banks led Britain's top share index higher on Thursday, maintaining early gains as the Bank of England's (BoE) Monetary Policy Committee kept interest rates unchanged and made no new quantitative easing purchases.

By 1216 GMT, the FTSE 100 was 18.32 points or 0.3 percent, higher at 5,812.85 after falling 0.2 percent on Wednesday.

The BoE's decision makers shrugged off debt concerns in the euro zone, rising inflation in the UK and Britain's anaemic growth outlook, to meet analyst expectations and keep interest rates at 0.5 percent and total asset purchases at 200 billion pounds.

"(There's been) absolutely no reaction whatsoever, not surprisingly -- we didn't expect anything to come out of it," James Hughes, market analyst at CMC Markets, said.

"When we get to the meeting minutes, that's going to be the key point, to see how the votes were ... if we're going to get movement it will be then."

Banks were higher, led by Royal Bank of Scotland up 3.3 percent. But Standard Chartered shed 2.6 percent after issuing a trading update.

Gains were supported by mining and energy stocks as investors received a shot in the arm as proposed fiscal stimulus measures in the United States helped boost the outlook for the global economy.

"It's a case of two steps forward and one step back, but there's a bit more confidence that there's some growth about and that's not a bad situation for equities," Neil Tong, head of UK equities at Alliance Trust said.

However he added that caution was likely to remain as government debt problems around Europe have yet to be resolved.

EU leaders continued to disagree over how to tackle Europe's sovereign debt issues. (Editing by Hans Peters)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.