FTSE Eyes BoE decision as Markets Weigh Rate Cut

The FTSE 100 steadied ahead of the Bank of England’s closely watched rate decision, with markets pricing a nearly one-in-three chance of a cut to 3.75% amid cooling inflation and labour data. Asian shares rebounded after strong US economic figures, easing concerns over tech valuations following Wednesday’s selloff. Meanwhile, traders trimmed bets on a December Fed rate cut, and US Supreme Court justices questioned the legality of Trump-era tariffs.

Equities

The FTSE 100 closed 0.6% higher at a record 9,777.08 points on Wednesday, supported by gains in oil and gas majors and strength across consumer sectors. The FTSE 250 added 0.5%, ending a seven-day losing streak. Energy stocks rose 1.2% as firmer crude prices lifted the sector, while the personal goods index advanced 2%, led by Burberry, which climbed 3.1%. The luxury fashion group benefited from renewed optimism in high-end retail demand.

AstraZeneca’s shares slipped 0.6% after a muted session for pharmaceutical firms. Metro Bank surged 8.3% after reaffirming its annual outlook, while Barratt Redrow rose 0.9% after Britain’s largest housebuilder confirmed its annual completions target. Clean energy developer Ceres Power jumped 18.9% following news of a strategic licensing deal with its largest Chinese investor aimed at supplying technology to data centres.

Marks & Spencer’s shares were little changed, as the retailer said it expected to have fully recovered from April’s cyber attack by March and forecast second-half profit at least in line with last year. Investors now look to Thursday’s Bank of England rate decision, with markets expecting policymakers to hold rates steady.

In the United States, Wall Street rebounded on Wednesday after Tuesday’s sharp sell-off. The Dow Jones Industrial Average rose 0.48% to 47,311.00, the S&P 500 gained 0.37% to 6,796.29, and the Nasdaq Composite climbed 0.65% to 23,499.80. The advance came as upbeat earnings and solid economic data offset valuation concerns in the technology sector.

McDonald’s closed up 2.2% after stronger-than-expected same-store sales, helped by demand for affordable meal offers. Amgen surged 7.8% following a quarterly profit beat, while Johnson Controls jumped 8.8% after reporting better-than-expected 2026 profit guidance. Match Group’s shares rose 5.2% despite a revenue forecast below market expectations.

Super Micro Computer fell 11.3% after disappointing results, and Bank of America slipped 2.0% even as it raised its profitability target.

Forex & Commodities

The US dollar held near a five-month high, supported by stronger-than-expected US economic data. The dollar index was steady around 100.16 after gaining 1.5% over the past week, its highest level since late May. Figures showed US private payrolls rose by 42,000 in October, ahead of forecasts for a 28,000 increase, while services sector activity also picked up. The data strengthened expectations that the Federal Reserve may delay any further interest rate cuts this year.

Sterling edged higher to $1.305 late on Wednesday but remained close to a seven-month low against the dollar ahead of today’s Bank of England meeting, with markets pricing roughly a one-in-three chance of a 25-basis-point rate cut. The dollar slipped marginally against the Swedish crown after the Riksbank left interest rates unchanged, while the Norwegian central bank is due to meet later today.

The Japanese yen weakened through the New York session after initial gains earlier in Asia, and the Australian dollar moved higher to $0.6510 as risk appetite improved during European trading. Bitcoin also rebounded to around $103,995 after falling below $99,000 on Tuesday.

Gold rose early on Thursday as the dollar eased from a four-month high, with spot prices up to $3,996 per ounce by 0712 GMT. Investors remained cautious amid the ongoing US government shutdown and questions over the legality of President Trump’s tariffs.

Oil prices moved higher this morning, with Brent crude at $63.76 a barrel and West Texas Intermediate at $59.85, after OPEC+ signalled a pause in production increases and sanctions on Russian producers eased concerns about oversupply.