17th Sep 2026 07:00
(Alliance News) - Stocks in London are set to open higher on Thursday after the Federal Reserve delivered its first interest rate increase in more than three years, while investors now turn their attention to the Bank of England's policy decision.
IG says futures indicate the FTSE 100 to open 17.1 points higher, 0.2%, at 10,705.57 on Thursday. The index of London large-caps closed up 0.3% at 10,688.47 on Wednesday.
The Bank of England announces its latest interest rate decision at 1200 BST. The FXStreet-cited consensus expects the central bank to leave Bank Rate unchanged at 3.75%.
Sterling was quoted at USD1.3382 early Thursday, lower than USD1.3449 at the London equities close on Wednesday. Against the euro, sterling rose to EUR1.1672 from EUR1.1658 a day prior.
The euro traded at USD1.1465 early Thursday, lower than USD1.1537 late Wednesday. Against the yen, the dollar was quoted at JPY155.81 versus JPY155.09.
Brent oil was trading at USD105.15 a barrel early Thursday, higher than USD104.54 late Wednesday.
In the US on Wednesday, Wall Street ended lower, with the Dow Jones Industrial Average down 1.2%, the S&P 500 down 0.5% and the Nasdaq Composite marginally lower.
The US Federal Reserve raised interest rates for the first time in just over three years as it seeks to bring "elevated" inflation back to its 2% target.
The Federal Open Market Committee voted unanimously to raise the federal funds target range by 25 basis points to 3.75%-4.00%, in line with the FXStreet-cited consensus. It marked the first rate increase since July 2023.
In a brief statement, the Fed said the move was intended to support its dual mandate.
"Inflation remains elevated. Today's policy action will support a timelier return to the Committee's 2% goal. The Committee will deliver price stability," it said.
Updated economic projections showed policymakers expect one further rate increase this year, with no additional hikes in 2027. Interest rate cuts are forecast to resume in 2028.
Meanwhile, OpenAI pledged to report incidents of artificial intelligence models behaving unexpectedly more systematically, while publishing six new reports detailing previously undisclosed episodes of AI misbehaviour.
The move follows a series of incidents that have emerged since July, including two OpenAI models that, during testing, escaped their contained environment to access the internet and infiltrate several websites and online platforms.
The company said the new reporting framework is intended to improve transparency around the capabilities and risks of advanced AI systems.
The announcement came after Anthropic Chief Executive Dario Amodei called for a coordinated slowdown in AI development to allow more time to understand the technology's risks. OpenAI Chief Executive Sam Altman, Google DeepMind President Demis Hassabis, SpaceXAI chief Elon Musk and Microsoft Chief Executive Satya Nadella all backed the proposal.
In Asia on Thursday, the Nikkei 225 index in Tokyo rose 0.2%. In China, the Shanghai Composite fell 0.3%, while the Hang Seng index in Hong Kong lost 1.1%. The S&P/ASX 200 in Sydney added 0.3%.
Gold was quoted at USD4,297.26 an ounce early Thursday, lower than USD4,345.07 on Wednesday.
Back in geopolitics, US President Donald Trump threatened to curb trade with the EU after the bloc proposed making Canada its first-ever associate member.
European Commission President Ursula von der Leyen floated the proposal ahead of Canadian Prime Minister Mark Carney's address to the European Parliament, outlining closer cooperation on technology, defence and energy.
"I think it's laughable," Trump told reporters. "If they do that, if I think it's at all a hostile act, I will put very serious tariffs or stop trading with Europe, on many things."
He added: "If it's a good intention, that's fine. If it's a bad intention, we'll put very heavy tariffs on Europe, which is a possibility."
In Thursday's corporate calendar, Beauty Tech Group, Galliford Try and Next report half-year or full-year results, while Picton Property Income and Unite Group issue trading statements.
In the economic calendar on Thursday, Switzerland releases trade data, the eurozone publishes final inflation figures, and the UK announces its latest interest rate decision.
In the US, weekly jobless claims and building permits are due, while Canada releases producer price data.
By Eva Castanedo, Alliance News senior economics reporter
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