FTSE 100 Builds on Gains After Bank of England Decision

The FTSE 100 builds on earlier gains, up 0.6% or 43 points at 7117, after the Bank of England kept interest rates unchanged amid caution about economic-recovery prospects. Miners, construction and oil stocks lead London's blue-chip index higher. While the central bank is hoping inflation will ease off naturally as the U.K. economy picks up, it's clearly not minded to raise interest rates any time soon, online trading firm Infinox says. "For now, the bank judges growth is still sufficiently fragile that it's worth living with the inflationary threat and kicking an interest-rate rise into the long grass," says Infinox Head of Trading Ulas Akincilar. "All of which has gone down well with U.K. equities, but hit sterling." (phi

 
Companies News: 

First Property Group Suspends Final Dividend After FY 2021 Loss, Shares Drop

Shares in First Property Group PLC fell Thursday morning after it reported a loss for fiscal 2021 and suspended the final dividend.

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UK Takeover Panel Agrees Extension to Augean, Morgan Stanley Takeover Deadline

Augean PLC said Thursday that the U.K. Takeover Panel has agreed to extend the deadline for Morgan Stanley Infrastructure Inc. to make an offer for the U.K. waste-management company or walk away in order that they can continue talks.

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Atlas Copco Buys UK Air-Compressor Supplier

STOCKHOLM--Swedish industrial tool maker Atlas Copco AB said Thursday that it has acquired U.K.-based Airflow Compressors & Pneumatics Ltd (Airflow) for an undisclosed price.

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San Leon Agrees to $8.5 Mln Investment in Nigerian Oil Export Project; Shares Rise

Shares in San Leon Energy PLC rose Thursday morning after it agreed to acquire a further interest in the Alternative Crude Oil Evacuation System project in Nigeria.

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CMO Group to Float on London's Junior AIM

Online building-material retailer CMO Group PLC said Thursday that it plans to float on London's junior AIM early next month.

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Edenville Energy on Track to Achieve Full Order Book for Tanzanian Coal Mine

Edenville Energy PLC said Thursday that it expects to achieve a full order book for its Rukwa coal project in Tanzania in the next few months.

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Alpha Financial Markets FY 2021 Pretax Profit Fell Slightly

Alpha Financial Markets Consulting PLC on Thursday reported a small decrease in pretax profit for fiscal 2021 and said that all of its regions performed well and revenue grew in the year.

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Maternity-Wear Brand Seraphine Confirms London IPO Plan; To Raise GBP61 Mln

British maternity- and nursing-wear brand Seraphine said Thursday that it plans to raise 61 million pounds ($85.2 million) of new money and proceed with an initial public offering on the London Stock Exchange next month.

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LungLife AI, Inc. to Float on London's Junior AIM

LungLife AI, Inc. said Thursday that it plans to float on London's junior AIM early next month.

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R.E.A. Holdings Agrees to Replace Current Loan, Working Capital Facility

R.E.A. Holdings PLC said Thursday that its subsidiary PT REA Kaltim Plantations has conditionally agreed with its Indonesian bankers to replace its current loan with two new loans, and has agreed a new working capital facility to replace its current one.

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Visa Buys Swedish Fintech Tink for More Than $2 Billion

Visa Inc. agreed to pay more than $2 billion for Tink, a Swedish startup whose digital services connect more than 3,400 banks and financial institutions in Europe.

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Universe Group Chairman Buys Additional Stake for More Than GBP1 Mln

Universe Group PLC said Thursday that its Executive Chairman Andrew Blazye has spent 1.1 million pounds ($1.5 million) to acquire a further stake in the company.

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San Leon Enters Talks to Merge With Nigerian Partner Midwestern Oil & Gas

San Leon Energy PLC's trading on the AIM was suspended on Thursday morning because it is in talks for Midwestern Oil & Gas Co. to reverse into the company.

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Augean Says Tax Tribunal Sides With Company in Dispute With UK Authority

Augean PLC said Thursday that a U.K. tax tribunal has decided in the company's favor after it contested a preliminary issue with the U.K. tax authority over how to interpret certain elements of landfill tax law.

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Heavitree Brewery Swung to 1H Pretax Loss as Lockdown Hit Revenue

Heavitree Brewery PLC said Thursday that it swung to a pretax loss for the first half of fiscal 2021 as revenue took a hit from coronavirus-related restrictions, and said support from customers bodes well for its prospects.

 
Market Talk: 

BOE's Vote on QE Hits Sterling

1258 GMT - Sterling's decline after the Bank of England's policy decision Thursday likely reflects a higher-than-expected number of policymakers voting in favor of keeping quantitative easing unchanged, TD Securities says. There was speculation that two policymakers would vote to scale back bond purchases but just one policymaker--economist Andy Haldane, who is leaving after Thursday's meeting--voted in favor of the move, TD forex strategist Ned Rumpeltin says. "With Haldane's departure imminent, the MPC will either need to find a fresh hawk, or the default position of the committee might revert to a unanimous consensus to keep QE unchanged in August."

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Bank of England Decision Spells Mixed Outlook For Firms

1244 GMT - The Bank of England's decision to keep interest rates unchanged holds positives and negatives for up-and-coming U.K. companies, Deepbridge Capital says. The central bank's announcement will be welcome news to many early-stage businesses who feared rising inflation could have triggered higher rates, the investment firm says. "However, the bank did also suggest CPI could rise to as much as 3%, raising the question of exactly how long it can hold interest rates at current levels, with any rises directly impacting how much businesses are able to borrow at a crucial time," Deepbridge Managing Partner Ian Warwick says. "Therefore, the biggest problem for growing early-stage companies may be access to funding."

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UK Five-year Gilts Still Vulnerable to Policy shift

1244 GMT - Five-year U.K. benchmark government bonds remain vulnerable from a trading perspective to both rate hikes and expectation of any reduction in the stock of Bank of England's assets, says TD Securities. "This is primarily driven by the aggressive repricing of rate hikes in the front end of the [gilt] curve," says senior European rates strategist Pooja Kumra. She still believes that the slope of the yield curve between five and 30-year gilts could be still prone to more flattening. The five-year gilt yield trades last at 0.352%, down from 0.386% before the central bank announcement, according to Tradeweb.

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Pound Falls as Imminent BOE Rate Rise Unlikely

1243 GMT - The Bank of England's policy statement Thursday suggests the central bank clearly isn't minded to raise interest rates any time soon and that has weakened sterling, online trading provider Infinox says. The BOE's dismissal of inflation risks as temporary has hit sterling like a "bucket of cold water," says Ulas Akincilar, head of trading at the broker. "While it's hoping, rather than certain, that inflation will ease off of its own accord as the U.K. economy gets back into its stride, the Bank is clearly not minded to raise interest rates any time soon," he says. GBP/USD falls 0.4% to 1.3916 and EUR/GBP rises 0.5% to 0.8587.

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BOE Unlikely to End QE Earlier than December

1207 GMT - Despite bank officials' split 8 to 1 vote to continue quantitative easing, the Bank of England is unlikely to curtail the program early, says ING. "The BoE remains on track to actively stop expanding its balance sheet at the end of the year - having tapered the pace of purchases last month," analysts at the Dutch bank say. "Unexpectedly ending the scheme early would potentially set a precedent in the eyes of investors, and risks limiting the potency of future QE programmes," they say. Bank officials voted unanimously for the central bank to maintain the stock of sterling non-financial investment-grade corporate bond purchases at GBP20 billion, but chief economists Andrew Haldane voted again against to continue with the GBP875 billion gilt-buying program.

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BOE Seen in Holding Pattern For Now

1204 GMT - The Bank of England's latest policy statement is cautiously upbeat but it's clear policymakers are in a holding pattern for the time being, ING says. Thursday's statement was a "little more upbeat" than expected, but "crucially offers no new clues on rate hike timing," ING economist James Smith says. "The central bank is caught between higher-than-expected inflation and encouraging activity data, and mounting uncertainty surrounding Covid-19." ING expects the first interest rate rise in early 2023, based on the assumption that inflationary pressures ease through mid-2022.

 

Contact: London NewsPlus, Dow Jones Newswires; +44-20-7842-931

(END) Dow Jones Newswires

June 24, 2021 09:30 ET (13:30 GMT)

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