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(Alliance News) - The FTSE 100 closed at an all-time high on Friday, rounding off a busy week of central bank interest rate decisions on a positive note.
The FTSE 100 index closed up 81.64 points, or 1.0% at 7,901.80 on Friday - a record for the index and the highest since 2018. It hit an intraday record high of 7,906.58. The index finished the week as a whole 1.8% higher.
The FTSE 250, meanwhile, ended down 21.23 points, or 0.1%, at 20,593.46, but ended the week 2.8% higher.
The AIM All-Share closed up 1.03 points, or 0.1% at 889.79, ending the past five days 2.6% higher.
The Cboe UK 100 ended up 1.1% at 789.78, the Cboe UK 250 closed down 0.2% at 17,937.50, and the Cboe Small Companies ended up 0.9% at 13,888.41.
Investors were upbeat following more-dovish language from the Bank of England on Thursday, which many took as a signal that the central bank may be reaching the end of a sustained period of interest rate rises.
The Bank of England lifted interest rates by another 50 basis points and tempered its guidance for future hikes as it acknowledged that inflation in the UK "is likely to have peaked".
Thursday's rate lift takes the benchmark bank rate to 4.00% from 3.50%. It was an outcome expected by the market, according to consensus cited by FXStreet.
Analysts at ING said it was "abundantly clear from both the press release and the new forecasts that the Bank is laying the groundwork for the end of the current tightening cycle."
The internationally-focused FTSE 100 was also buoyed following higher-than-expected US employment growth data on Friday.
Avatrade analyst Naeem Aslam said: "Today we had a mind-blowing number for the US NFP; the reading was so good that many had to check the reading twice to make sure that there was nothing wrong there. The data has confirmed that the US labor market is not only strong but it is robust, and concerns about recessions are unnecessary."
According to the Bureau of Labor Statistics, US nonfarm payrolls rose by 517,000 in January, almost double the 260,000 from December. January's number was well-ahead of consensus of 185,000, according to FXStreet.
Average hourly earnings growth slowed. Earnings rose 4.4% on-year last month, undershooting the 4.9% expected by consensus. Earnings had risen by 4.9% in December.
The numbers suggest the US jobs market remains red-hot in the face of interest rate hikes by the Fed.
The central bank on Wednesday slowed the pace of its rate hikes, lifting the federal funds rate range by 25 basis points to 4.50% to 4.75%.
The dollar strengthened significantly in the wake of the nonfarms payroll report. The pound was quoted at USD1.2093 at the London equities close on Friday, down sharply from USD1.2315 at the close on Thursday.
The euro stood at USD1.0844, lower against USD1.0919 at the same time on Thursday. Against the yen, the dollar was trading at JPY130.94 late Friday, higher compared to JPY129.28 late Thursday.
Stocks in in New York were broadly higher at the time of the London equities close, with the Dow Jones Industrial Average up 0.3%, the S&P 500 index flat, and the Nasdaq Composite up 0.2%.
In the FTSE 100, Shell closed up 4.0%. On Thursday, the oil major reported soaring annual profit on surging commodity prices. It also announced another buyback of USD4 billion, after recently completing a repurchase programme of the same size.
Shell rounded off 2022 with a fourth-quarter revenue hike of 12% to USD101.20 billion, from USD90.22 billion in 2021. Pretax profit edged by a more modest 1.1% on-year to USD16.44 billion from USD16.27 billion.
For the whole of 2022, Shell made a yearly pretax profit of USD64.81 billion, more than doubling from USD29.83 billion. Revenue for 2022 soared 42% to USD386.20 billion from USD272.66 billion.
Peer BP finished 1.7% higher. Brent oil was quoted at USD81.44 a barrel at the London equities close on Friday, down from USD84.42 late Thursday.
BT Group were up 1.9% after UK regulator Ofcom gave its early backing for BT's Openreach broadband plan. Ofcom said that its provisional view is that BT unit Openreach's Equinox 2 scheme does not break competition rules in the UK.
In December, Openreach published plans to offer lower wholesale prices to other internet providers for access to its fibre network, but the move saw network rivals raise competition concerns. It announced plans to offer discounted rates on its fibre broadband products as part of its Equinox 2 scheme.
On Friday, Ofcom said it should not intervene to prevent Openreach from introducing Equinox 2.
"We consider the offer is not anti-competitive and is consistent with the rules we consulted on before introducing them under our market review in 2021," Ofcom said. It intends to publish its final decision before the end of March and welcomes responses until March 4.
Elsewhere in London, Nanoco plunged 26% as it agreed a USD150 million settlement with Samsung Electronics Co for IP infringement.
"This has been a long and hard battle for Nanoco. The outcome is remarkable, given the relative scale of Nanoco and Samsung," Nanoco Chair Chris Richards said.
Nanoco initially launched a US patent infringement lawsuit against the South Korean-based electronics company in December, alongside lawsuits in Germany and China. It claimed Samsung infringed on its unique synthesis and resin capabilities for quantum dots. Quantum dot technology is used on Samsung quantum light-emitting diode televisions.
In European equities on Friday, the CAC 40 in Paris ended up 0.9%, while the DAX 40 in Frankfurt ended down 0.2%.
Data released by S&P Global showed that the eurozone's economy grew in January, following six successive months of contraction.
The S&P Composite purchasing managers' index for the single currency area rose to 50.3 points in January, from 49.3 in December. This marks a seven-month-high and the first time that the eurozone private sector economy has grown since June 2022.
S&P's Chief Business Economist Chris William said: "A resumption of business output growth, even marginal, is welcome news and suggests that the eurozone could escape a recession."
Gold was quoted at USD1,867.11 an ounce, sharply lower against USD1,928.82 at the close on Thursday.
In Monday's UK corporate calendar, there's a trading statement from biological product provider Plant Health Care and full-year results from investment firm BlackRock Throgmorton Trust.
In the economic calendar on Monday, there is a UK construction PMI print at 0930 GMT before EU retail trade data at 1000 GMT.
By Heather Rydings, Alliance News senior economics reporter
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