By Sara Sjolin and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- The U.K.'s FTSE 100 index moved
slightly higher on Wednesday, with investors encouraged by
better-than-expected unemployment data, but remaining cautious
ahead of the nearing referendum on Scottish independence.
London's benchmark index rose 0.1% to 6,801.28, but still lagged
gains for bourses across Europe. The index has been down for two
straight sessions, amid investor caution over the potential for a
"yes" outcome to the Scottish vote to leave the U.K. Polls open
Thursday, with the results expected early Friday. Read: Good
riddance, Scotland: We don't need you
In the latest polls, the pro-union camp was still narrowly in
the lead, but analysts call the race at this point too close to
call. Both sides of the debate were making their final pitches on
Wednesday, with Scotland's First Minister Alex Salmond writing to
voters and pleading for a "yes" vote.
The pound (GBPUSD), which has been suffering from uncertainty
surrounding the referendum, showed some strength, trading at
$1.6311, versus $1.6282 late Tuesday.
Unemployment data: It was also a busy day on the U.K. economic
calendar, with the latest round of labor market data out. The goods
news was that the joblessness rate for the three months to July
dropped to a lower-than-expected 6.2%, marking the lowest level
since August 2008. The bad news, however, was that wage growth
remained low, meaning that Brits continued to suffer from falling
pay in real terms.
Bank of England minutes: The central bank was also in the
spotlight after releasing its minutes from the September meeting,
where the Monetary Policy Committee kept interest rates and the
quantitative-easing program unchanged. The vote on interest rates
was unchanged at 7-2 in favor of keeping the benchmark lending rate
at a record low of 0.5%.
Sam Hill, senior U.K. economist at Berenberg, said in a note
that the minutes struck a dovish tone, as the MPC said,
"accumulating evidence of the weakness in the euro area had been
the most significant development during the month".
The two-day U.S. Federal Open Market Committee meeting could
keep investors at bay. The focus will fall on the Federal Reserve
policy statement and any change in language that could hint of a
sooner-than-expected hike in interest rates. Read: The only two
words that will matter at the Fed
Stocks:Smiths Group PLC topped the losers list with a more than
5% drop, after the medical-device and airport-scanner maker posted
a fall in full-year revenue and profit, dragged by a weak
performance at its detection business.
Miners were on the rise, with heavyweights such as Rio Tinto PLC
(RIO) up 1% and BHP Billiton PLC (BHP) adding 0.5%. Anglo American
PLC rose 0.4%.
Lloyds Banking Group PLC (LYG) was a heavyweight gainer, up
1.9%, and chip designer ARM Holdings PLC (ARMHY) added 2.4%.
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