Despite moving higher into mid-day, the FTSE slumped to close 42 points lower on the back of a $2 drop in the price of Crude OIl to $55 and fears of a rate rise. A large part of the decline was attributed to declines in a few stocks, namely, DSG, BP, RDSB, Vodafone and HSBC, which pulled the rest of the market lower later in the day on the back continuing worries about the US Economy. Also many stocks went ex-dividend today which further depressed prices.

Earlier ICI led the advancers, gaining 10%, after announcing the sale of Quest, its flavours and fragrance business, to Givaudan of Switzerland for £1.2 billion. Mining Stock were also strong as metal prices firms. Xstrata rose 2.2% and BHP Billiton 2.5

The latest Bank of England's MPC minutes showed that members voted seven to two in favour of the last hike to 5% which indicates that future decisions are likely to be close with expectations of a further rise by March 07. The minutes showed that those that voted for the rate rise, were nervous about the new year wage round, especially since the Retail Prices Index (RPI) had risen to 3.7% (used as the benchmark for many pay deals)

Related Articles

Nov 11, 2006	FTSE100 and Dow Jones show signs of having Peaked following US Elections
Nov 10, 2006	UK Interest Rates set to rise to 5.25% by March 2007
Nov 07, 2006	UK Interest Rates could rise to 5.75% in 2007
Nov 05, 2006	UK Insolvency rise by 55% and on target to hit a record 100,000 for 2006 As interest rates are due to rise to 5% !
Oct 22, 2006	UK Interest Rates Forecast to rise much higher due to rising Inflation and high Money Supply Growth
Oct 17, 2006	UK Inflation rises to a 8 year high of 3.6% (RPI), whilst CPI dips to 2.4%
Oct 05, 2006	BOE Keeps Interest Rates on Hold Whilst the ECB raises to 3.25%
Sept 21, 2006	Interest rates likely to rise to 5% in November 06

Comments

Post Comment (Moderated)

Subject:

Name:

E-mail address (will not be published):

Comment:

Commenting Issue - If on submitting you are returned to the main Index Page (50% chance) then your comment has not been accepted, Follow below steps for 95% chance of comment being accepted.

Click your browser Back button (from main index page).
COPY your comment text from Comment box (i.e. copy to clipboard).
Press PAGE Refresh - You should see the message "You are not authorized to carry out this operation"
Paste your comment back into the comment text box.
Click Submit - If everything goes okay you will remain on the article page with the message "Your comment was held for moderation and will be reviewed shortly".
If instead you are again returned to the main index page then repeat 1-5, alternatively EMAIL to comments @ marketoracle.co.uk quoting the article number.

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2011 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.