London’s FTSE 100 ended up by 0.1% and the FTSE 250 was up by 0.2% amid a flat day of trading as investors shifted money into banks, expecting further rate hikes from central banks around the world.
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The Bank of England’s Monetary Policy Committee was due to have its next interest rate meeting on September 15, but this has been pushed back by a week due to the death of Queen Elizabeth.
In America, analysts also expect further rate hikes, after CPI inflation figures.
Rupert Thompson, investment strategist at Kingswood, said, “These numbers, along with the recent hawkish rhetoric of its officials, mean the Fed looks all the more likely to carry out another 0.75% increase in rates next Wednesday, rather than a more moderate 0.5%.”
In Britain, analysts expect a special budget from Prime Minister Liz Truss and Chancellor Kwasi Kwarteng – including tax cuts. The idea of lifting the cap on banker’s bonuses has also been mooted, aiming to lure top global bankers back to the City of London. Kwarteng told City executives last week, “We need to be decisive and do things differently.”
Homebuilders such as Barratt (GB:BDEV) rose up to 4%, rebounding after heavy losses in the previous two days, and a 3% slump in Brent crude prices sent Shell (GB:SHEL) down by 1.1%.
British business news today
Truss prepares new bid to persuade SoftBank to list ARM in London (FT)
Renewables boss takes over at Shell (Times)
Bank of England backs plan to rip up bonus cap (Telegraph)
