Market rises on US rate cut

A half per cent rate cut yesterday from the US Federal Reserve helped boost the FTSE 100 in early trading.

Opening at 4,271.15, the benchmark index continued to climb and was one per cent ahead by 08:10 GMT.

Yesterday, the FTSE achieved its third highest percentage gain ever on anticipation of further interest rate cuts.

The US Federal Reserve met expectations last night by cutting the interest rate to one per cent, while the European Central Bank and the Bank of England are also forecast to announce cuts soon.

A mix of mining and financial stocks boosted the FTSE 100, with Antofagasta up 11.41 per cent, Friends Provident up 10.83 per cent and Old Mutual up 9.25 per cent.

Several shares were trading lower, however, with Admiral topping the list with a 12.34 per cent decline.

Royal Dutch Shell also saw its shares slide two per cent by 08:19 GMT, despite announcing a 70 per cent rise in profits.