(Reuters) -London stocks rose for a third consecutive day on Wednesday as investors ramped up bets on interest rate cuts from the Bank of England after data showed inflation unexpectedly held steady, while lender Barclays jumped after a surprise share buyback plan.
Barclays advanced 4.2% to become the best boost on the FTSE 100 index after announcing a 500 million pound ($670 million) share buyback and upgraded a key profitability target for the year. This boosted the banks index by 1.6%.
Inflation for the month of September was held at 3.8%, coming below the Bank of England’s estimates of 4%, raising bets on a rate cut this year. Traders see a roughly 75% chance that the BoE’s Monetary Policy Committee will cut bank rate to 3.75% from 4% at its December meeting, up from about 46% before the data.
The data brings in much-needed relief ahead of the November budget by finance minister Rachel Reeves, who along with BoE policymakers have been trying to navigate through sticky inflation and slow economic growth.
The blue-chip FTSE 100 gained 0.9% to 9,547 points by 1116 GMT, while the mid-cap focused FTSE 250 advanced 1%.
Oil majors BP and Shell gained 1.4% and 1.2%, respectively, as oil prices edged higher. [O/R]
Among individual stocks, Rio Tinto advanced 2.1% after sources say the miner explored a potential asset-for-equity swap with Chinalco that would trim the Chinese investor’s 11% stake, which would help the company to resume buybacks and pursue new strategic deals.
On the flip side, ITV shares slid 8.2% after the broadcaster said its largest shareholder Liberty Global reduced its stake to 5% from 10% in the company. The stock was the worst performer in the FTSE 250.
($1 = 0.7451 pounds)
(Reporting by Avinash P; Editing by Shailesh Kuber)
Comments