The FTSE 100 outperformed European peers on Thursday, but remained in the red in the immediate aftermath of the Bank of England leaving bank rate unmoved, following the Federal Reserve doing the same with US rates on Wednesday.
A ‘gradual and careful approach’ to monetary policy easing will be pursued by Threadneedle Street, the decision statement said on Thursday.
‘Should there be greater or longer-lasting weakness in demand relative to supply, this could push down on inflationary pressures, warranting a less restrictive path of bank rate. Should there be more constrained supply relative to demand and more persistence in domestic wages and prices, including from second-round effects related to the near-term increase in CPI inflation, this would warrant a relatively tighter monetary policy path,’ the central bank added.
The FTSE 100 index was down 22.84 points, 0.3%, at 8,683.82. The FTSE 250 was down 30.34 points, 0.2%, at 20,092.03, and the AIM All-Share was up just 0.35 of a point, 0.1%, at 694.97.
The Cboe UK 100 was 0.2% lower at 869.87, the Cboe UK 250 was down 0.1% at 17,532.01, and the Cboe Small Companies was up 0.2% at 15,635.16.
In European equities on Thursday, the CAC 40 in Paris was trading down 1.0%, while the DAX 40 in Frankfurt slumped 1.4%.
The pound was quoted at $1.2974 on Thursday afternoon, where it stood at the time of the equities close on Wednesday. It had bought $1.2960 just before the decision.
The euro stood at $1.0841, fading from $1.0883 late Wednesday. Against the yen, the dollar was trading at JP¥148.44, down from JP¥149.87.
The BoE left bank rate at 4.50%, as expected. Eight members of the Monetary Policy Committee backed the proposal, with only Swati Dhingra dissenting, preferring a 25 basis point cut.
ASK Partners analyst Daniel Austin commented: ‘The Bank of England’s decision to hold interest rates steady reflects the ongoing balancing act amid Trump-driven market uncertainty, tariff policies, and the UK’s upcoming tax changes.’
The decision followed the latest batch of UK jobless data.
Scope Market analyst Joshua Mahony commented: ‘The morning kicked off with a raft of employment metrics from the UK, with lower-than-expected total wage growth (5.8%) and a bump in the employment change figure (144,000) being counteracted by a seven-month high for the claimant count (44,000).’
The UK jobless rate steadied at the beginning of 2025, while pay growth largely slowed, data from the Office for National Statistics showed on Thursday.
For the three months to January 31, the UK unemployment rate was 4.4%, in line with FX Street-cited consensus and where it stood in the three months to December.
Including bonuses, average yearly pay growth was 5.8%, shrinking from 6.1% in the three months to December and falling short of a 5.9% FX Street-cited consensus.
Mahony continued: ‘The moderation of wage pressures are unlikely to shift the dial given the clear ongoing inflation concerns associated with wage growth that is almost three-times the rate of the target inflation rate. While we have seen UK gilts moving lower in response this morning, the fact of the matter is that ongoing inflation pressures will soon be accompanied by the uncertain impact of Trump’s tariffs and global trade war.’
Stocks in New York were called lower. The Dow Jones Industrial Average was called down 0.5%, the S&P 500 index 0.6% lower, and the Nasdaq Composite down 0.8%.
Crest Nicholson was one of the FTSE 250’s leaders on Thursday at noon, up 9.7%, behind an 11% rise for fashion retailer Asos.
The housebuilder in a trading update reported an encouraging start to the year with early evidence of operational improvements.
Its open market sales rate was 0.61 per week per outlet in the 10-week period to March 14 compared with 0.50 a year ago, supported by self-help initiatives and revised incentive schemes.
Crest Nicholson said it remains on track to deliver full-year results in line with guidance, with its cash performance tracking better than expected in the first four months.
Bloomsbury Publishing was also among one of Thursday’s winners on the FTSE 250, rising 3.8% after it said trading in its recently-ended financial year topped consensus, helped by a strong second half.
The publisher hailed broad-based ‘success’ in its consumer-focused division. In the non-consumer arm, the buy of Rowman & Littlefield academic publishing offering. The deal was a ‘game-changer for Bloomsbury’, Chief Executive Nigel Newton said back in May. It bought the unit for up to $83 million.
For the year ended February 28, Bloomsbury said trading was ‘ahead of consensus expectations’.
It puts consensus at £333.4 million for revenue and £39.6 million for pretax profit before ‘highlighted items’. In financial 2024, it reported revenue of £342.7 million and pretax profit before highlighted items of £48.7 million.
Bloomsbury announces results on May 22.
Oracle Power slipped 4.0% on Thursday, eating into Wednesday’s gain, when it rose 12%.
The Australia and Pakistan-focused projects developer said its joint venture Oracle Energy has been granted an extension to the validity period for its proposed 1.3 gigawatt renewable energy powerplant in Jhimpir, Sindh Province in Pakistan.
Oracle’s letter of intent is now valid until May 13, 2026, from its initial January 23 deadline.
‘The extension of the LOI supports ongoing development, as we continue to progress on financing, investment matters and offtake contracts. We appreciate the valuable support from the Department of Energy, Government of Sindh, and will provide further updates as we progress,’ said Oracle CEO Naheed Memon.
The stock surged on Wednesday following its receipt of positive assay results from drilling at its Northern Zone project in Western Australia.
Brent oil was quoted at $70.90 a barrel at midday in London on Thursday, rising from $70.72 late Wednesday.
Gold was quoted at $3,030.80 an ounce, down versus $3,036.51 on Wednesday.
Still to come on Thursday’s economic calendar, US initial jobless claims and the Philadelphia Fed manufacturing index at 1230 GMT.
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