FTSE 100 hovers close to 6,000 after Bank of Japan unveils shock interest rate cut
The FTSE briefly edged above 6,000 points again this morning as investors cheered a shock decision by the Japanese central bank to cut one of its main interest rates to negative.
The bank cut its benchmark rate to -0.1 per cent, effectively meaning it will charge lenders interest for excessive reserves parked in its coffers.
The news caused Japanese shares to rally, with the Nikkei finishing 2.8 per cent higher.
While the FTSE 100 jumped more than one per cent in the first minutes of trading, it later dipped back below the 6,000 mark. The index has hovered below the psychologically important point for most of 2016, although it did edge above it during intraday trading yesterday.
Among the biggest risers were miners Anglo American and Glencore, up 4.2 per cent and three per cent respectively, following a solid day's trading yesterday.
"What the Fed was unable to achieve the BoJ managed giving a much need lift to equity markets surprising the markets by adopting a negative interest rate … with comments that further cuts would be made if deemed necessary," said Mic Mills, head of client services at Capital Index.
"A strong end to the month this week will make investors feel a lot better about themselves and means the overall losses for the month aren't going to be anywhere near as bad as they looked like they'd be only a few days ago," added Simon Smith, chief economist at Fxpro.