FTSE closes slightly up on interest rate expectations

| July 20, 2005 | 0 Comments
FTSE closes slightly up on interest rate expectations

After a more vigorous rise early in the day, the FTSE 100 closed 0.2 percent higher at 5,215.2, while the FTSE 250 also rose 0.2 percent to 7,434.6 on a trading volume of 3.2 billion shares on Wednesday.

The rise was partly attributed to higher hopes for an interest rate cut next month when the minutes from this month’s Monetary Policy Committee meeting revealed that four members of the committee voted for a cut in the UK rates, two more than had voted for the cut in June.

Growth in China helped mining stocks to gains as Rio Tinto was up 4.4 percent to £18.38, BHP Billiton rose by 3.9 percent to 772p, Xstrata gained 2.9 percent to £11.48, and Antofagasta advanced by 3.4 percent to £12.74.

Retailer GUS gained 5.5 percent to 901p on a gain in sales at the Experian credit checking business and higher-than-expected sales for the Homebase outlets. The retailer also set a schedule for selling its majority share of Burberry.

Following this success, Next, the clothing retailer, gained 2.5 percent to £15.70, while electrical retailer Dixon added 1.8 percent to 159p. Marks and Spencer, however, only managed an 0.3 percent gain to 360 ¼p as Credit Suisse First Boston cut its target price to 350p per share, down from 380p.

In mid-cap stocks, P&O, the ports and ferry group, was up 3.7 percent to 319 ¾p as it was announced that it has gotten preliminary permission to turn a former refinery in Thurrock, Essex, into a major port.


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