FTSE 100 slips ahead of Bank of England rates decision this week; Next shares spike higher

The FTSE 100 started the week lower ahead of the Bank of England’s interest rates decision on Thursday. The Bank of England is expected to raise interest rates for the 13th time in a row by 0.25% to 4.75%.

Poor performance in Asian equities and a speech by Jerome Powell were also adding to investor worries on Monday.

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“Investors are lacking Monday motivation today as caution returns amid worries about global growth, ahead of the Bank of England decision on interest rates and testimony from the world’s most influential central banker, the Fed’s Jerome Powell,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“European indices have opened lower with the FTSE 100 on the back foot as investors mull what’s ahead for the path of interest rates, given the stubbornness of inflation, while concerns persist about China’s recovery losing steam.”

Investors will not be so worried about the Bank of England’s rate decision on Thursday but more of the hints of where rates could go later in the year. Some traders are pricing UK interest rates as high as 6% this year.

The FTSE 100 was down 0.5% to 7,606 at the time of writing.

FTSE 100 movers

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FTSE 100’s high-beta cyclical names led the way lower on Monday, with Ocado sinking around 3.8%.

Miners were weaker on concerns China’s recovery was under threat. Antofagasta and Anglo-American were both down more than 1%.

Although JD Sports have repeatedly proved they can successfully navigate economic uncertainty, the risk of 6% rates was hitting the sportswear group on Monday.

Next shares spiked higher during the session after saying trading in the most recent period was better than expected. Next shares were the FTSE 100’s gainers at the time of writing, up 3.8%.

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