Global markets had a strong day on Thursday in the wake of the Fed’s decision not to raise interest rates at their September meeting.
The FTSE 100 has been in positive territory throughout the session, hitting a five week high and jumping by more than 1.4 percent to an intraday high of 6,933.14. France’s CAC40 and Germany’s DAX index both rebounded on Thursday, with Asian markets closing almost exclusively higher.
Markets have been quiet all week ahead of the decision by the US Federal Reserve, with many speculating that Wednesday would be the day for a rate rise. However, Federal Reserve chair Janet Yellen announced the Committee had voted against a rise, but left the door open for a post-election hike in December.
Accendo Markets’ Mike van Dulken commented: “Equity indices are being buoyed by the Fed’s decision to delay its next interest rate rise, even if it is trying hard to prep us for the possibility of another unwelcome early Christmas present, like last year.
“Nonetheless, downgraded growth projections suggests uncertainty within the ranks. Investors have latched onto this, asking whether a rate hike will be delivered in 2016 at all, happy at the prospect of lower rates for longer, and globally.
“Commodities are benefiting from a resulting weaker USD with Miners topping the U.K. index while Banks digest the prospect of lower rates for longer, hurting profit margins.”
Mining shares benefited most from the Fed’s decision, with a weaker dollar making commodities more attractive. Glencore (LON:GLEN) is up 6.11 percent at 209.16, with BHP Billiton (LON:BLT) up 4.90 percent at 1102.50. Hochschild Mining (LON:HOC) is also up 8.61 percent despite a downgrade by Barclays.
Billing Services Group (LON:BILL) was another big riser on Thursday, currently up 20 percent despite announcing weaker than expected profits. Travel group TUI (LON:TUI) is also up nearly 5 percent, following the positive trend in the markets.
However, Xtract Resources (LON:XTR) are down 27.50 percent at 0.0290 after announcing their exit from investments in Chile. Biotech company Shire (LON:SHP) is one of the biggest fallers in the FTSE 100, currently down 1.32 percent at 5,176.00.