FTSE 100 rallies on Bank of England’s lack of action
The FTSE 100 advanced by 191.8 points, or 3%, ending the day at 6421.7 after the Bank of England announced that it would not be altering the 0.5% interest rate and brushed off claims that a rise in interest rates could take place next year, labelling them as “not warranted”.
Just two of the London blue-chip indexes constituents saw declines during the session; BSkyB which declined 1.5p to 812.5p and Schroders which fell by 19p to close at 2236p. Investors in good spirits after Mark Carney’s first meeting as the Gov of the Bank of England, generally being extremely happy with the results of the first Monetary Policy Committee meeting that he chaired. Additionally, concerns over the situation in the Middle East eased as the Egyptian army confirmed that they will seek to hand over control of the country to a civilian political party as soon as an election can be organised and held.
EasyJet were one of the FTSE 100’s top performers for the day, rising by more than 3% after announcing that its total passengers for the month of June was 5.5 million, an increase of 100,000 passengers year-on-year. The budget airlines stock rose by 47 points, resulting in the closing price of 1367p.
Bankers also had a good day as the outlook for the British economy looked broadly positive. The Royal Bank of Scotland added 14.1p, closing at 284.1p. However the government owned retail bank was outshone by Standard Chartered which advanced by 69p to close at 1496.5p.
The only real negative was the sliding of the pound sterling, which fell 2 cents to the dollar on the back of the announcement from the Bank of England regarding its unchanged interest rates.