Reuters: Hot Stocks: Britain's FTSE gives up gains after a silent BoE

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Britain's FTSE gives up gains after a silent BoE Aug 1st 2013, 11:53 Thu Aug 1, 2013 7:53am EDT * FTSE 100 up 0.1 pct * BoE holds rates, offers no guidance * Shell weighed down by results By Toni Vorobyova LONDON, Aug 1 (Reuters) - Britain's FTSE 100 erased early gains after the Bank of England left policy unchanged on Thursday and stayed silent on the future path of interest rates. Although the consensus was for on-hold rates at this month's meeting, some analysts had seen a small chance of an equities-friendly rate cut and more had expected a statement signalling that policy will remain accommodative for some time to come even though the economy is starting to pick up. Now investors will have to wait until next week's inflation report, when the central bank is expected to lay out "forward guidance" on British monetary policy. "Most traders had expected the BoE announcement (of unchanged rates), but the accompanying release would have helped formed the expectations of the timeline for any change in monetary policy," said Joe Bond, trader at Abshire Smith. The European Central Bank also left rates on hold. The FTSE 100 was up 0.1 percent or 4.29 points at 6,625.35 by 1145 GMT, retreating from an earlier session high of 6,656.91 . Royal Dutch Shell was the biggest weight on the index, down some 5 percent after its second-quarter profits were hit by a combination of rising costs, a surge in oil thefts in Nigeria and other factors. On the flip side, Lloyds added 8.4 percent after beating profit forecasts thanks to higher margins and lower impairments on loans. "Policy is most firmly directed, in my mind, to boosting the economic environment for domestic economic operations and the biggest beneficiaries of that are the banks," said Gerard Lane, strategist at Shore Capital. "If you are an investor who wants to take a very strong view you remain long of the domestic banks." (Additional reporting by Tricia Wright; Editing by Catherine Evans) Link this Share this Digg this Email Reprints

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