Interest rate hopes buoy FTSE 100
FTSE 100 ends 0.61 per cent higher at 5,262.23 on low interest rate hopes
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By Michael Younger. |  |
Wednesday, 11, Nov 2009 05:19
After soaring to their highest levels so far this year on the prospect of low interest rates into 2010, the FTSE 100 ended higher, up 0.61 per cent to 5,262.23.
The Bank of England's inflation report this morning was followed by the FTSE 100 breaking through the 5,300 barrier, as investors were cheered by the implication that interest rates will remain low for most of 2010.
By the end of the session, the index had slipped from its 13-month high, but still remained out of the red.
Mining stocks led the rally on higher metals prices. Randgold Resources topped the index, gaining 5.77 per cent, followed by silver miner Fresnillo, up by 5.46 per cent.
Insurance shares were also up, as European regulators indicated they could be open to changing rules that, in their current form, would force annuity sellers to raise more capital.
Legal & General gained 5.16 per cent, while Aviva rose 2.93 per cent on the index.
Publisher Reed Elsevier ended the day lower, after the firm's chief executive quit unexpectedly, falling by 4.02 per cent.
Banks also remained in the red, including Lloyds Banking, down by 2.54 per cent and Royal Bank of Scotland, down by 1.69 per cent.