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BoE hikes by an expected 25 bps
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Banks down, precious metal miners help cut losses
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Informa down after MS downgrade
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FTSE 100 down 0.8%, FTSE 250 off 0.4%
By Shashwat Chauhan March 23 (Reuters) - London stocks held their intraday losses after the Bank of England raised its main lending rate by an expected 25 basis points on Thursday, while bank stocks fell for the first time in three days. The FTSE 100 fell 0.8%, after recording its highest closing level in more than a week on Wednesday. The BoE raised interest rates for the 11th consecutive time, and said it expects the surge in British inflation to cool faster than before, despite a surprise jump in consumer prices on Wednesday. "Gone are the days that you get a rate cut immediately when you see some concerns around growth," said Vivek Paul, UK chief investment strategist at BlackRock Investment Institute.
The BoE was not due to hold a quarterly news conference by Governor Andrew Bailey and other officials on Thursday, although he is scheduled to make a speech on Monday.
The pound held gains against a weaker dollar after
the U.S. Federal Reserve, which hiked rates by 25 bps on
Wednesday, indicated it was on the verge of pausing further
increases after a global banking rout.
"This follows on from the Fed and the European Central
Bank in recent days, goes to show that this is a new regime,"
Paul said.
UK banks lost 1.5% after two straight days of gains. The FTSE 250 midcap index also fell 0.4% with Inchcape down 13.3%. Helping limit losses were precious metal miners , which gained 2.5% on higher gold prices.
Fears of a banking crisis after the collapse of two U.S. regional lenders and troubles at Swiss bank Credit Suisse have rattled global markets recently. The FTSE 100 has erased most of its gains for the year and is now up 0.7%.
Informa fell 2.3% after Morgan Stanley cut its rating on the events organizer's stock to "equal-weight" from "overweight". (Reporting by Shashwat Chauhan in Bengaluru; Editing by Savio D'Souza and Anil D'Silva)
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