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LONDON (Alliance News) - All the major UK stock indices closed slightly lower Wednesday as investors prepare for the results of the US Federal Bank's decision on interest rates and its asset purchasing programme, scheduled for 1900 BST this evening.
Expectation is divided, with some of the opinion that the Fed will leave the USD85 billion a month asset buying progrmme as it is until later in the year, and others expecting that the programme could be cut by up to USD15 billion a month this month.
The FTSE 100 closed down 0.2% at 6,558.82, the FTSE 250 closed down 0.4% at 15,089.22, whilst the AIM All-Share index closed down 0.3% at 783.13, having traded in tight ranges all day as investors moved to the sidelines to await a Fed decision that is likely to give markets their direction for the rest of the week.
At the stock level, Central Rand Gold was a big winner on its first day of trading on AIM. It closed up 167% at 19.81 pence having moved down from the London Stock Exchange's main market. The company said it has received the first tranche of its USD7.25 million loan note payments, allowing it to progress upgrades to its crushing and milling facilities.
Barclays, meanwhile, was the biggest loser on the FTSE 100 blue-chip index as the shares from its massive GBP5.8 billion placing started trading. The bank closed down 6.9% at 278.4393p.
At the close of the UK equities market, gold is trading down 0.9% at USD1298.40 per ounce. Consequently, gold mining companies were again some of the heaviest fallers on the FTSE 250. Hochschild Mining closed down 8.1% at 210.889p, with African Barrick Gold closing down 3.2% at 137.494p.
Brent oil prices rebounded a bit, up 1.1% at USD108.90 a barrel, following two consecutive days falling as a result of easing tensions in the Middle East.
The pound rose following the Bank of England's announcement that Monetary Policy Committee voted unanimously, 9-0, to keep the UK base rate of interest at 0.5% and quantitative easing at GBP375 billion at its last meeting. At the close of the UK equity markets, sterling was trading at USD1.5966 and EUR0.8362.
All the main US stock indices were down at the close of UK markets. US housing starts showed an increase of 0.9%, or 891,000, missing consensus expectations of a rise to 917,000. Similarly, building permits fell to an annual rate of 918,000, missing the 950,000 forecast. The DJIA is down 0.3% at 15,491.22, the S&P was down 0.2% at 1,701.71, and the Nasdaq was down 0.1% at 3,741.34.
Thursday's data calendar sees Japan release industry activity data at 0530 BST and leading economic index figures at 0600 BST. Swiss export and import figures are scheduled for 0700 BST, with Swiss National Bank releasing its interest rate decisions at 0830 BST. UK retail sales information is announced at 0930, with CBI industrial trends survey at 1100 BST. 1300 BST sees the release of Russian central bank reserves, before US jobless claims are announced at 1330 BST. US Home sales data are due at 1500 BST.
The corporate calendar includes trading statements from ASOS and United Utilities and interim results from Premier Farnell.
By James Kemp; jameskemp@alliancenews.com
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