Reuters: Hot Stocks: Banks lead FTSE 100 up on rate cut expectations

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Banks lead FTSE 100 up on rate cut expectations May 1st 2013, 15:33 LONDON | Wed May 1, 2013 11:33am EDT LONDON May 1 (Reuters) - Britain's top shares gained in thin trade on Wednesday as banks rose further on expectations of more monetary easing from the European Central Bank. The FTSE 100 provisionally closed up 10.88 points, or 0.2 percent, to 6,441.00 points, rising on the first day of the month for the 10th straight time in a quiet session, with most European bourses closed for public holidays. Expectations of more action to boost growth - in particular an anticipated ECB interest rate cut - has helped the FTSE rally more than 3 percent from mid-April lows. Banks added most points to the index, up 0.5 percent to take their gains since April 18 to 6.1 percent. "The rally in the banks is very much an illustration of these hopes that there'll be a rate cut," James Butterfill, global equity strategist at Coutts, said. "There certainly seems to be a 25 basis point cut (from the ECB) priced in now, so if that didn't happen, I'd be very surprised if we didn't see a correction in the market." Ahead of the ECB decision on Thursday, markets will also have the opportunity to digest the latest monetary policy meeting of the U.S. Federal Reserve, the results of which come out after the close on Wednesday. (Reporting by Alistair Smout; editing by Simon Jessop) Link this Share this Digg this Email Reprints

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