FTSE 100 flat despite rate cut
Thursday 8th January 2009, 5:07PM GMT.
The FTSE 100 has ended flat following the Bank of England’s interest rate decision.
The monetary policy committee cut the interest rate by 0.5 per cent, in a move anticipated by the market, and the index ended the day at 4,505.37, 2.14 points lower than yesterday.
Mining stocks were still dragging the FTSE lower, with Vedanta Resources down six per cent and Anglo American dropping 5.74 per cent.
Banking stocks are still enjoying a rally, however. Shares in Barclays rose 5.54 per cent, while Lloyds TSB was up 3.47 per cent.
J Sainsbury, which produced a set of positive sales figures this morning, closed 2.25 per cent higher.
Ryan Kneale, market analyst at BetsForTraders.com, said: “The optimism at the start of the year has now almost completely vanished and not even the Bank of England cutting the UK base rate, to a record low of just 1.5 per cent, was enough to stop today’s slump in share prices.
“Many believe the central bank have been reactive in this crisis, when a proactive approach was needed, and as such today’s rate cut offers little hope to the British consumer if the high street banks refuse to pass it on.”
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