FTSE hits two year high after UK rates remain unchanged

The Bank of England has opted on Thursday to leave interest rates unchanged at 0.5 per cent, citing positive indications that the British economy on the mend. This decision has led to a buoyant market with the FTSE hitting its highest level since June 2008.

Chris Bradshaw
shareprices.com - Thursday, November 04, 2010

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Man Group

AT 12.20 GMT, the FTSE had risen by 1.7 per cent reaching 5847, following a drop in Wednesday's index of 0.2 per cent. With no quantitative easing planned by the Bank of England, city traders saw a strong morning market on Thursday. Trading had been uneasy over the past week with a lot of anxiety over the looming policy decision from the Federal Reserve. However the announcement of $600 billion being injected into the US economy was welcomed by the market.

Oil and miners were the biggest winners. With both sectors usually dealing in dollars, as the US currency weakens, the price of the commodities increases leading to a rise in the stock.

Financial companies also posted a strong morning with Man Group rising by 11.3 per cent. The global asset management company announced a rise in client assets to $40.5 billion at the end of September.

However, despite positive market conditions, as ever there were still some fallers, most notably Rolls Royce posting a drop of 4.7 per cent. This loss is largely attributed to flights of the Airbus A380 fleet being taken out of the air after an emergency landing due to engine failure in Singapore. The Quantas airbus uses Rolls Royce engines to power its aircraft.

 

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