London midday: FTSE stays down as BoE hikes by 25 basis points

London stocks were still in the red by midday on Thursday after the Bank of England hiked rates by 25 basis points to 4.25%, as expected, in the face of rising inflation.

The FTSE 100 was down 0.8% at 7,504.36, while sterling was 0.3% firmer against the dollar at 1.2310.

The Monetary Policy Committee voted 7-2 for the rate increase, which was the 11th in a row by the Bank.

Data released on Wednesday by the Office for National Statistics showed that consumer price inflation rose to 10.4% in the year to February from 10.1% in January. Analysts had been expecting a decline to 9.9%.

John Leiper, chief investment officer at Titan Asset Management, said: "No surprise today from the Bank of England with a 25bps rate hike, already priced-in, following the bumper inflation data yesterday. We think there is more to come to combat inflation, even as the bank grapples with financial stability concerns and rising recessionary headwinds that could tip the economy into contractionary territory later this year."

Earlier, the Swiss National Bank hiked its key policy rate for the fourth meeting in a row, by 50 basis points to 1.50%, in line with consensus expectations. The Bank said it was looking to tackle "the renewed increase in inflationary pressure" and that further rate hikes could not be ruled out to ensure price stability in the medium term.

On Wednesday, meanwhile, the Fed increased rates by 25 basis points despite recent turmoil in the banking sector.

In equity markets, Schroders, Prudential, Pearson and Close Brothers all lost ground as they traded without entitlement to the dividend.

Inchcape slumped even as the automotive distributor reported a rise in annual earnings driven by growth in new and used vehicle sales and higher prices.

Informa was knocked lower by a downgrade to ‘equalweight’ at Morgan Stanley.

On the upside, Puretech Health surged after US-listed Royalty Pharma bought an interest in the company’ royalty in Karuna Therapeutics' KarXT drug for up to $500m.

Gas producer Energean rallied after saying it almost doubled annual 2022 profits and that it expects output this year to reach 131,000-158,000 barrels of oil equivalent (boed) per day after the launch of its main Karish field off Israel.

Bulmers and Magners owner C&C Group fizzed higher after saying it expects to report a jump in full-year revenues and operating profit despite a challenging backdrop, and to resume dividend payments later in the year.

Darktrace was boosted by an initiation at ‘buy’ at HSBC.

Market Movers

FTSE 100 (UKX) 7,504.36 -0.83%
FTSE 250 (MCX) 18,684.40 -0.39%
techMARK (TASX) 4,537.19 0.04%

FTSE 100 - Risers

Endeavour Mining (EDV) 1,841.00p 2.79%
Melrose Industries (MRO) 158.25p 2.66%
NATWEST GROUP (NWG) 273.00p 1.41%
3i Group (III) 1,590.00p 1.34%
Fresnillo (FRES) 735.40p 1.16%
Severn Trent (SVT) 2,828.00p 1.14%
Centrica (CNA) 104.30p 1.07%
BAE Systems (BA.) 968.20p 1.06%
Beazley (BEZ) 555.00p 1.00%
United Utilities Group (UU.) 1,050.00p 0.86%

FTSE 100 - Fallers

Schroders (SDR) 442.90p -4.42%
Ocado Group (OCDO) 418.20p -3.88%
British American Tobacco (BATS) 2,890.50p -3.30%
HSBC Holdings (HSBA) 549.10p -2.75%
Convatec Group (CTEC) 218.00p -2.50%
Kingfisher (KGF) 264.60p -2.43%
Tesco (TSCO) 252.90p -2.36%
Informa (INF) 676.60p -2.34%
Standard Chartered (STAN) 637.00p -2.30%
Legal & General Group (LGEN) 230.20p -2.25%

FTSE 250 - Risers

PureTech Health (PRTC) 224.50p 10.59%
Energean (ENOG) 1,214.00p 8.68%
Darktrace (DARK) 280.00p 3.51%
C&C Group (CDI) (CCR) 153.70p 2.60%
Vistry Group (VTY) 751.00p 2.46%
Centamin (DI) (CEY) 102.35p 2.45%
Ithaca Energy (ITH) 153.80p 2.26%
4Imprint Group (FOUR) 5,040.00p 2.23%
Premier Foods (PFD) 123.40p 1.98%
JTC (JTC) 688.00p 1.93%

FTSE 250 - Fallers

Inchcape (INCH) 735.00p -15.22%
OSB Group (OSB) 468.00p -6.59%
Wizz Air Holdings (WIZZ) 2,675.00p -3.98%
Ibstock (IBST) 168.60p -2.77%
Derwent London (DLN) 2,242.00p -2.69%
Wood Group (John) (WG.) 199.00p -2.69%
Chemring Group (CHG) 275.50p -2.48%
Wetherspoon (J.D.) (JDW) 577.50p -2.45%
Hammerson (HMSO) 22.49p -2.39%
Close Brothers Group (CBG) 901.00p -2.38%