UK’s top stocks jump higher as Bank boss weighs up further rate hikes
The FTSE 100 closed 38.65 points higher, or 0.49%, at 7,914.93,
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Your support makes all the difference.The UK’s top stocks have jumped back into positive territory after the Bank of England’s boss hinted it was weighing up whether or not to push forward another interest rate hike.
Governor Andrew Bailey was neither here nor there over the Bank’s monetary policy plans, saying that he would caution against suggestions either that it was done hiking the base rate, or that there were more to come.
But his ambiguous remarks were enough to move markets, with the FTSE 100 jumping higher shortly after the speech – indicating investors were pleased about the prospect of the cycle of rate hikes coming to an imminent end.
The FTSE 100 closed 38.65 points higher, or 0.49%, at 7,914.93, lifting it back above the 7,900 mark but still lagging behind the record-breaking 8,000 it reached earlier on in the month.
After being among the first to flash its hawkish plumage, the Bank now seems to have donned more dovish attire, though another couple of months of strong data could see that outfit put away again
Meanwhile, the pound dropped below 1.2 US dollars during the day, after enjoying a brief rally following the Prime Minister unveiling his post-Brexit deal on the Northern Ireland Protocol.
The pound was trading at 1.203 dollars when European markets closed. Sterling also dropped by 1% against the euro to about 1.126, having fallen steadily after Mr Bailey’s speech.
Chris Beauchamp, chief market analyst at online trading platform IG, said: “It would be a brave person who put much faith in Andrew Bailey’s comments about UK interest rates, but his view that rates might not need to keep rising has put the FTSE 100 on top among global indices while seeing the pound drop back against the dollar and fall more dramatically against the euro.
“After being among the first to flash its hawkish plumage, the Bank now seems to have donned more dovish attire, though another couple of months of strong data could see that outfit put away again.”
Elsewhere in Europe, the Dax was down by 0.39% and the Cac was down by 0.46%.
There was mixed sentiment in early trading over in the US, with the S&P 500 down 0.16% and Dow Jones up 0.2% by the time European market closed.
In company news, shares in Persimmon plunged after the housebuilder told investors it plans to nearly halve the number of homes it releases onto the market this year.
The FTSE 100-listed company is set to feel the impact of a downturn in the housing market, cautioning that its profits and margins will fall this year as a result of far fewer completions of its properties.
Its share price was down by 12% at close.
On the other hand, it was a good day for Aston Martin Lagonda which saw its share price jump by more than a fifth at one point on Wednesday morning after saying it expects to see a significant growth in profitability over 2023.
It followed the luxury car maker reporting that annual losses had more than doubled last year after it suffered from supply chain disruption.Its share price eased back in the afternoon and was up by 3.2% at close.
Purplebricks told shareholders it was launching a formal process to put itself up for sale after receiving approaches from several potential buyers.
The online estate agent, which has seen the value of its shares wiped out in recent years, confirmed it has no offer on the table just yet.
Its share price lifted by 11% on Wednesday.
The biggest risers on the FTSE 100 were Weir Group, up 119p to 2,108p, Rio Tinto, up 260p to 5,972p, Antofagasta, up 66p to 1,636p, Endeavor Mining, up 67p to 1,764p, and Glencore, up 17.55p to 512.9p.
The biggest fallers on the FTSE 100 were Persimmon, down 175p to 1,277.5p, Barratt Developments, down 19.6p to 449.5p, Taylor Wimpey, down 5.05p to 118.15p, Ocado Group, down 19.2p to 529.6p, and Unite Group, down 31.5p to 951.5p.