London’s top flight index hit it highest level in almost five years today as the Bank of England signalled that interest rates will remain at emergency levels for years to come.
The FTSE 100 Index closed at its highest level since May 2008, up 20.7 points to 6,359.1 as Bank boss Sir Mervyn King said policymakers were prepared to tolerate another three years of above-target inflation to support economic recovery.
Among stocks, falls were sparked after a raft of leading blue-chip firms began trading without the right to their latest dividend payment.
AstraZeneca, Royal Dutch Shell and BP were among those to go ex-dividend, falling by 68.5p to £29.50, 29p to £21.86 and 6.5p to 453.69p respectively.
In the top flight, shares in household goods group Reckitt Benckiser were 1% higher after the company posted better-than-expected results for 2012. The performance included a 5% rise in net income to £1.8billion, helping shares close 56p higher at £44.19.
Traders also welcomed the first significant stock market flotation of the year, with housebuilder Crest Nicholson making its return after a five-year absence.
Shares were priced towards the top end of market expectations at 220p, valuing the company at £553 million, and closed up at 247.8p.
The biggest FTSE 100 risers were Tullow Oil up 80p to £12.60, CRH ahead 64p to £14.20, Wolseley 98p higher at £30.84 and Amec up 33p to £11.24.
The biggest FTSE 100 fallers were Sage Group down 9.9p to 333.3p, AstraZeneca off 68.5p to £29.50 and Carnival 53p lower at £25.75.
Mark Ireland, of investment manager and financial planning specialist Brewin Dolphin in Inverness, noted that risers included Anglo Pacific, gaining 5.1% to 274.3p.
Fallers included A.G. Barr down 7.1% to 522.8p, Optos losing 2.6% to 209.8pp and regional newspaper publisher, Johnston Press off 1.9% at 12.8p.