FTSE 100 recovers on Fed hopes of continuing stimulus scheme – London Report
Britain’s top equity index yesterday cut most of its daily losses to close almost flat as a Federal Reserve official hinted at a continuation of the central bank’s asset purchase programme.
The FTSE 100 closed down just 0.3 per cent at 6,195.91 points after hitting its lowest level since June 2013 at 6,072 points earlier in the session.
The index was rebounding from deep in oversold territory, based on widely used momentum indicators such as the Relative Strength Index, which compares the size of rises and falls.
The bounce gathered momentum after the head of the St. Louis Federal Reserve Bank said the US central bank might want to keep up its bond-buying stimulus for now given a drop in inflation expectations.
However, Shire slid 7.3 per cent to 3,718p, adding to a 22 per cent drop on Wednesday, after US pharmaceutical company AbbVie recommended that shareholders vote against a $54bn takeover of its British peer after a US government move to curb tax inversion deals designed to cut high taxes.