This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
In London, stocks fell after the Bank of England kept its monetary policy unchanged. While analysts were expecting no change in policy, what surprised markets was that all nine members voted in favour of keeping interest rates at 0.5% and the bond-buying scheme at £375 billion per month.
Traders were caught off guard as they expected a minority of members to vote in favour of increasing the stimulus package. Dealers sold equities following the release, as they feel stocks will fall without additional stimulus from the Bank.
In corporate news, BHP Billiton is up 1.2% after announcing a huge 238% increase in operating profit and a 124% increase in revenue for the first half of 2013. BHP’s figures have also given a lift to other mining companies this morning.
Smiths Group is in the red, 3% lower, after issuing a profit warning. The engineering firm said full-year profit is likely to be below £15 million, which is below consensus expectations.