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Bulls are back: Index heading towards 7,000

FTSE 100 hits year-high on rate cut and US jobs

London Stock ExchangeStocks in London rose to their highest level in more than a year in response to the interest rate cut and positive news on jobs in the US.

The FTSE 100 index peaked at 6,802.41 before closing at 6,793.47, up 53.31 points (0.79%). 

It is at its highest since 21 July 2015 and was the second closing high of  the past week after hitting 6,750.43 on 27 July. The index logged a weekly rise of 1%, a second-straight weekly gain.

The FTSE 100 has now risen 7% since the UK voted to leave the European Union. The more UK-focused FTSE 250 soared to its highest level since 31 December.

The Bank of England’s decision to cut interest rates for the first time since March 2009 and sanction a £70 billion bond-buying programme added £27 billion to the value of Britain’s blue chips.

The index is now close to breaking through the 7,000 barrier which it last breached in April last year. Its all-time intra-day high is 7,122.74, which it reached on 27 April, and its highest close is 7,103.98 on the same day.

Housebuilders Persimmon, Berkeley Group and Barratt yesterday enjoyed gains on hopes that th interest rate cut will give a lift to house buying.

The rise in the London market followed a surge in new jobs in the US. July figures came in at 255,000, against a prediction of 180,000.

One stain on the gains was Royal Bank of Scotland which slumped 8.5% at one point to top the worst performers in the FTSE 100 index after its first-half losses widened. It ended as the biggest faller, down 7.19% or 13.8p to 178.2p,

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