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FTSE 100 closes at record high | |
(about 1 hour later) | |
The London market hit new record highs on Thursday as investors reacted to Wednesday's interest rate rise by the US Federal Reserve. | |
Analysts also said there was some relief in the market at the defeat of the anti-immigration Freedom party in the Dutch election. | Analysts also said there was some relief in the market at the defeat of the anti-immigration Freedom party in the Dutch election. |
The benchmark FTSE 100 rose 47.31 points to a record closing high of 7,415.57. | |
Earlier it hit a record intraday high of 7,440.4 points before falling back. | |
In mid-afternoon trading the index was 38 points higher at 7,406 points. | In mid-afternoon trading the index was 38 points higher at 7,406 points. |
Neil Wilson at ETX Capital said the message from the US central bank was "the US economy is firing, but inflation is not going to be an issue. It's in no hurry to raise rates - and that is good news for equities." | |
As well as raising rates on Wednesday, the Fed also indicated it planned two more rate rises this year. However, that was not as aggressive as some had feared, with some having predicted a further three increases in 2017. | As well as raising rates on Wednesday, the Fed also indicated it planned two more rate rises this year. However, that was not as aggressive as some had feared, with some having predicted a further three increases in 2017. |
Peter Cardillo, chief market economist at First Standard Financial, said: "A less aggressive Fed was clearly the message the markets wanted to hear and indeed acted accordingly." | Peter Cardillo, chief market economist at First Standard Financial, said: "A less aggressive Fed was clearly the message the markets wanted to hear and indeed acted accordingly." |
Yet Wall Street slid in afternoon trading, with the Dow Jones Industrial Average down 15 points, or 0.07%, at 20,934.85. The broader S&P 500 index also shed 0.12%. | |
UK rate rise closer? | UK rate rise closer? |
Sterling hit a two-week dollar high of $1.2373, up 0.6%, after the latest interest rate decision from the Bank of England. | Sterling hit a two-week dollar high of $1.2373, up 0.6%, after the latest interest rate decision from the Bank of England. |
Interest rates were kept on hold at 0.25% as expected, but minutes of the meeting showed that one policymaker had voted for a rate rise, the first time since July last year that the vote had not been unanimous. | Interest rates were kept on hold at 0.25% as expected, but minutes of the meeting showed that one policymaker had voted for a rate rise, the first time since July last year that the vote had not been unanimous. |
The minutes also indicated some other committee members might be close to voting for a rate rise | The minutes also indicated some other committee members might be close to voting for a rate rise |
However, Ruth Gregory at Capital Economics said: "Despite the more hawkish tone of today's minutes, rates look set to remain on hold for some time to come. | However, Ruth Gregory at Capital Economics said: "Despite the more hawkish tone of today's minutes, rates look set to remain on hold for some time to come. |
"A rate rise towards the end of 2018 seems more likely to us - provided that growth remains relatively resilient, as we expect." | "A rate rise towards the end of 2018 seems more likely to us - provided that growth remains relatively resilient, as we expect." |
Mining companies dominated the FTSE risers, with Anglo American topping the leaders' board with an 8% increase. | |
Its shares were boosted after Indian billionaire Anil Agarwal said he would buy a stake worth up to £2bn in the diamond and platinum miner. | Its shares were boosted after Indian billionaire Anil Agarwal said he would buy a stake worth up to £2bn in the diamond and platinum miner. |
Hikma Pharmaceuticals was the biggest loser, falling almost 5% to £21.89, after JPMorgan cut its outlook on the company to "neutral". | Hikma Pharmaceuticals was the biggest loser, falling almost 5% to £21.89, after JPMorgan cut its outlook on the company to "neutral". |
Merlin Entertainments, the operator of Madame Tussauds and the London Eye, shed 3% after analysts Berenberg said they saw signs that demand could be slowing. |
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