Traders widely expect the BoE to cut rates to 3.75% from 4.0% on Thursday, which would be the first reduction since August and bring borrowing costs to a three-year low. This expectation follows data showing inflation eased to 3.6% in October, with Governor Andrew Bailey's stance seen as pivotal.
Sector performance was led by a 2.5% jump in life insurers and a 1.7% rise in heavyweight banks. Prudential shares gained 3.2% after its Indian asset management joint venture's $1.2 billion IPO was fully subscribed. This financial sector optimism contrasts with looming labour market concerns, as investors await UK jobs data expecting the unemployment rate to hit a five-year high of 5.1% for October.
The FTSE 100 is headed for its best year since 2009, up 19.3% year-to-date and outpacing the S&P 500, driven by miners and financials. In other moves, TT Electronics shares plunged 17% after major shareholder DBAY Advisors said it would not make an offer, withdrawing from a potential bid battle with Switzerland's Cicor. The positive UK session contrasted with a risk-off mood in the U.S., where indexes fell ahead of delayed economic data and global central bank decisions.
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Source: REUTERS