The FTSE 100 hit a fresh record yesterday as traders placed bets on another interest rate cut from the Bank of England.
The index closed up 0.2 per cent, or 21.58 points, at 9164.31 after a similar record-breaking session on Tuesday when it passed 9142.
Traders shrugged off concerns about a trade war between the US and India after Donald Trump announced he would slap a 50 per cent tariff on goods from the South Asian nation in response to its importing of oil from Russia.
The FTSE 100 was led higher by insurer Hiscox, which jumped 9.4 per cent, or 119p, to 1379p after it announced it would be increasing its stock buyback plans by £75million.
Precious metals miner Fresnillo jumped 8.9 per cent, or 135p, to 1655p following strong results this week.
Traders were also pricing in an expected interest rate cut from the Bank of England later today.
New high: The FTSE 100 closed up 0.2%, or 21.58 points, at 9164.31 after a similar record-breaking session on Tuesday when it passed 9142
Market forecasts are predicting the central bank will lower rates by 0.25 per cent to 4 per cent.
Rate cuts tend to boost stock markets as they make it easier for firms to borrow and invest, stimulating growth.
Lower rates also make it easier for mortgage holders and other borrowers to repay their debts, leaving them with extra cash to spend elsewhere.
A rate of 4 per cent would be the lowest in over two years and signal that the decision-makers on the Bank’s Monetary Policy Committee believe inflation pressures are starting to ease.
But Tom Matterson, investment manager at Saltus, warned ‘significant instability remains’, highlighting the autumn Budget and turmoil in the global economy.
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