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London shares remain lower midmorning after USA Federal rate cut

LONDON, Dec. 12, 2007 -- Leading shares remained lower in midmorning deals, as the Federal Reserve quarter point interest rate cut disappointed investors, with financials and housing stocks under pressure.

At 10.00 am, the FTSE 100 index was down 33.6 points at 6,503.3, up from a low of 6,429.5, and down from a high of 6536.9, with the FTSE 250 index down 95.4 points at 10,552.6.

Volume was slightly above average, with 505 mln shares changing hands in 165,609 deals.

'(The market) is broadly coming to terms with what we saw in the US overnight -- a number of people were expecting a half point, but we got a quarter point,' said Keith Bowman, from Hargreaves Lansdown.

'Added to that, inflation figures coming out in the US on Friday should be significant; this could be a factor in the Fed's thinking as to why it only cut by a quarter,' he said.

Turning to UK economics news, the UK labour market continues to look very healthy, with the claimant count falling for the fourteenth consecutive month to take both the level and the rate to their lowest levels since 1975, official figures showed.

The Office of National Statistics said the claimant count, measuring the number of Britons claiming the jobseeker's allowance, fell by 11,100 in November, substantially beating forecasts for a 5,000 fall.

Among blue chips, financials and housebuilders came under pressure following heavy falls in the US overnight.

(Thomson Financial delivered by Newstex)

 

 









 


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