LONDON (Alliance News) - Stocks in London opened lower Thursday, with the focus on central banks as the US Federal Reserve, the Bank of Japan and Swiss National Bank all kept their respective monetary policy measures unchanged, and ahead of the Bank of England's announcement later in the day.
The FTSE 100 index was down 0.7%, or 39.75 points, at 5,927.05. The FTSE 250 was down 0.6% at 16,198.09 and the AIM All-Share was down 0.2% at 715.78.
In Europe, the French CAC 40 index was down 0.7% and the German DAX 30 was down 1.1%.
In Asia, the Nikkei 225 index in Tokyo ended down 3.1%, the Shanghai Composite closed down 0.5% and the Hang Seng in Hong Kong is down 2.1%.
Late Wednesday, the US Federal Reserve left its key interest rates unchanged, citing slowing "pace of improvement" in the US labour market, low inflation and geopolitical headwinds, such as the possibility of a Brexit.
The Fed's dot-plot of officials' interest rate forecasts still signalled two rate increases this year, but now six out of the 17 participants anticipated only one rate hike this year, up from one participant in March.
Early Thursday, the Bank of Japan kept its monetary stimulus unchanged as policymakers wait to the see the full impact of the negative policy introduced early this year.
Governor Haruhiko Kuroda and his board members decided by an 8-1 majority vote to hold its target of raising the monetary base at an annual pace of about JPY80 trillion. In addition, the board decided by a 7-2 majority vote to maintain the -0.1% interest rate on current accounts that financial institutions maintain at the bank. The outcome of the meeting matched expectations.
Soon after the London equities open, the Swiss National Bank said it left its key deposit rate unchanged at -0.75%, adding it thinks the Swiss franc remains significantly overvalued.
The Bank of England announces its monetary policy decision and releases its meeting minutes at noon London time. The central bank is expected to make no changes to its monetary policy ahead of the looming vote on the UK's membership of the European Union next week.
Elsewhere in the economic calendar, UK retail sales are at 0930 BST, and the eurozone consumer price index is at 1000 BST. Later in the day, expect US initial and continuing jobless claims at 1330 BST, the same time as US inflation numbers and the Philadelphia Fed manufacturing survey.
On the London Stock Exchange, ex-dividend stocks were weighing down on the FTSE 100, with private equity firm 3i Group the biggest faller, down 3.3%, while water and wastewater company Severn Trent was down 2.7%.
Gold miners were outperforming, as the price of gold hit its highest level in almost two years. The metal hit a high early Thursday of USD1,313.36 an ounce, its highest level since August 2014. Randgold Resources, up 3.4%, and Fresnillo, up 2.3%, were the best performers in the FTSE 100, while Centamin, up 6.4%, was the best in the FTSE 250.
N Brown Group reported a fall in revenue in the first quarter of its financial year, but said it is trading in line with expectations and left its full-year guidance unchanged.
The online and catalogue fashion retailer said group revenue in the 13 weeks ended May 28 fell by 0.2% year-on-year, as a 1.6% decline in product revenue offset 3.4% growth in financial services revenue.
The decline was an improvement on the 3.5% fall seen in the fourth quarter of the previous financial year but was short of the 4.3% growth reported in the first quarter of that year.
N Brown said overall trading is line with expectations, and its full-year guidance remains unchanged. The stock traded up 6.2%.
WS Atkins was another top mid-cap performer up 4.0%. The design, engineering and project management consultancy posted a 23% rise in pretax profit for its financial year, which it said was ahead of market expectations despite continuing uncertainty in some of its markets.
WS Atkins reported pretax profit of GBP131.1 million for the year ended March 31, up from GBP106.7 million the year earlier, on the back of a 6.0% rise in revenue to GBP1.86 billion from GBP1.76 billion.
The FTSE 250-listed company said its UK and Europe business delivered "very good results", with a strong performance across all its UK businesses except its aerospace company, which saw a slow start to the year. WS Atkins said the infrastructure market in the UK for rail, road and water projects remained "well funded" and investment continued to "enjoy government support".
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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