FTSE up on interest-rate news
The FTSE 100 Index was in the black for the third consecutive session today as the prospect of a reduction in interest rates buoyed banking stocks.
Northern Rock, Royal Bank of Scotland and Barclays all helped drive the market higher as they continued to benefit from yesterday’s news that two members of the Bank of England voted for a rates cut.
Investors also warmed to an announcement that telecoms group BT had set up a new business unit, helping the Footsie rise 18.5 points to 5117.8 by mid-morning.
The top flight broke through the 5100 barrier for the first time in three years yesterday.
A downbeat overnight session in New York – where the Dow Jones Industrial Average closed 11.8 points lower – failed to deflate spirits in London.
BT was the biggest blue-chip riser, adding 4% or 8.75p to 226.25p as industry regulator Ofcom outlined plans to ensure rivals gain fair access to its network. BT had previously faced the prospect of the possible separation of its wholesale and retail divisions.
Northern Rock was not far behind with a 20p rise to 809.5p, while Barclays cheered 8.5p to 561.5p and Royal Bank of Scotland lifted 22p to 1707p.
British Airways was another riser as the price of a barrel of US light crude oil dipped below its record levels of the last few weeks to $58.37. The stock added 2p to 281p.
Among those reporting today, supermarket Sainsbury’s weakened 1.25p to 289.5p despite posting its second consecutive quarter of like-for-like sales growth. Its fortunes contrasted with rival Morrisons, which featured high on the risers board with a 2.75p hike to 184.75p.
Elsewhere, tour operator MyTravel was in the black after saying its business had improved significantly against the same period last year. The stock added 2% or 0.11p to 5.61p despite posting a 36% fall in half-year losses.
