The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville

  • BT Group rises on confirmed outlook
  • BoE rate decision due at 1200 GMT
  • Weakness in pound boosts dollar earning companies
  • FTSE 100 adds 0.4%, FTSE 250 jumps 0.9%

Nov 4 (Reuters) – London’s FTSE 100 rose on Thursday, led by energy stocks tracking crude prices higher, while investors await a key Bank of England policy decision amid expectations of it becoming the first major central bank to hike rates since the pandemic.

The central bank is due to make its announcement at 1200 GMT against the backdrop of soaring prices and supply-chain problems. Equity markets have fully priced in an increase in the Bank Rate to 0.25% from 0.1%, while economists remain split. read more

“A rate increase of 0.15% to 0.25% could be argued as being entirely consistent with the recovery in the UK economy seen since the emergency measures were implemented back in March 2020,” said Michael Hewson, chief analyst at CMC Markets UK.

“More than anything if the UK economy can’t withstand a 0.15% rise in base rate, then we are in a very sorry state indeed… markets could be very unforgiving if having been led up the garden path by the bank they fail to deliver on their promises.”

The benchmark FTSE 100 index (.FTSE) gained 0.4% by 0910 GMT, with oil majors BP (BP.L) and Royal Dutch Shell (RDSa.L) and telecommunications company BT Group (BT.L) among the best performers.

BT Group (BT.L) added 5.1% after confirming its outlook for this year and next while reporting a 3% decline in first-half revenue. read more

The pound weakened as currency markets awaited the BoE’s knife-edge decision, further boosting the export-oriented FTSE 100 index and dollar earning companies like British American Tobacco (BATS.L).

Supply-chain problems and rising inflationary pressures have led the FTSE 100 to underperform its European and U.S. peers that are trading near record levels after a dovish tapering stance by the Fed on Wednesday.

The domestically focussed mid-cap index (.FTMC) advanced 0.9%, led by positive earnings from engineering firm IMI (IMI.L) and food ingredients maker Tate & Lyle (TATE.L)

Britain’s second largest supermarket grocer, Sainsbury’s (SBRY.L), fell 3.6% to the bottom of the blue-chip index, as uncertainty around supply chains outweighed a 23% rise in first-half profit. read more

Reporting by Bansari Mayur Kamdar and Shashank Nayar in Bengaluru; Editing by Subhranshu Sahu and Shailesh Kuber

Our Standards: The Thomson Reuters Trust Principles.

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