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* BOE cuts rates by 50 basis points
* Balfour Beatty biggest gainer on midcap index
* Homebuilders, banks rally
(Adds comment, updates prices)
By Shivani Kumaresan and Devik Jain
March 11 (Reuters) - London stocks climbed on Wednesday
after the Bank of England joined other major central banks in
cutting interest rates to buffer the economy from the
fast-spreading coronavirus.
Housebuilders - particularly sensitive to the domestic
economy - led gains on the STOXX 600, with Taylor Wimpey,
Berkeley and Persimmon all up about 4%.
The banking index rose 2.4%, with shares in
Lloyds Banking Group, Barclays and Royal Bank
of Scotland adding between 1% and 2%.
The central bank cut rates by 50 basis points to 0.25%,
following a similar move from the U.S. Federal Reserve last week
and said lenders in the country could tap special capital
reserves to keep lending to businesses and households.
"This is the type of policy co-ordination that the market
was actually looking for," said Stefan Koopman, senior market
economist at RaboResearch.
"We have a combination of lower interest rates, credit
easing measures and most likely a ramp up in fiscal spending,
which will be announced later today."
The FTSE 100 gained 1%, recovering from a four-day
slump fuelled by concerns about the fast-spreading virus and a
rout in oil markets.
The central bank's move came ahead of the unveiling of the
first budget of Prime Minister Boris Johnson's government at
1230 GMT, and the new Finance Minister Rishi Sunak is expected
to pledge billions of pounds to fight the fall-out from the
coronavirus.
On Tuesday, Junior Health Minister Nadine Dorries tested
positive for coronavirus, which has so far infected 373 people
and killed six in Britain.
Despite Wednesday's gains, the FTSE 100 is still down more
than 20% from its January peak as the outbreak takes a huge toll
on the travel industry and disrupts business operations.
Infrastructure group Balfour Beatty rose 10.1%,
biggest gainer among midcaps as the company posted strong
earnings and order book for 2019.
G4S, one of the world's largest private security
firms, fell 18.5% after posting an annual statutory loss as it
took a charge related to its UK cash business. [nL4N2B41ZF}
Car dealership Lookers sank 19.2% after it
identified potentially fraudulent transactions in one of its
operating divisions and postponed its annual results until the
second half of April.
(Reporting by Shivani Kumaresan and Devik Jain in Bengaluru;
Additional reporting by Sruthi Shankar; Editing by Bernard Orr)
