London Stocks Rise Amid Cautious Optimism Ahead of BoE Decision

London stocks edged higher on Thursday, with the FTSE 100 up 0.2% and FTSE 250 gaining 0.3% as investors awaited the Bank of England’s interest rate decision. Positive movements among individual stocks like Sainsbury's and Energean contributed to market gains, despite the cautious atmosphere.

London stocks edged higher on Thursday even as investors adopted a wait-and-watch stance ahead of a highly anticipated interest rate decision by the Bank of England (BoE).

The blue-chip FTSE 100 was up 0.2%, and set to register a third straight day of gains, if current trend holds. The mid-cap FTSE 250 was up 0.3% at 20,450.08 points.

The pound was steady against the dollar at $1.2706. Still, investors refrained from making massive bets as they eagerly count down to the central bank's vote at 1100 GMT.

"The worry is that it looks like a lot of good news is priced in ... from the recent inflation print in the UK, we are still not out of the woods and central banks want to avoid a wage price spiral," said Arun Sai, senior multi asset strategist at Pictet Asset Management. While it is widely anticipated that the BoE will hold the interest rates steady, all eyes will be on the vote-split and the comments from officials to assess the future trajectory of borrowing costs in Britain.

"The BoE can't go on a victory lap ... the market would be looking for commentary on how worried they are about the inflation print," Sai added. Among individual stocks, Sainsbury's gained 1% after NatWest struck a deal to acquire most of the banking business of the British retailer.

Shares of Energean jumped 5.1% after the oil and gas producer agreed to sell its assets in Egypt, Italy and Croatia to private equity fund Carlyle for up to $945 million. CMC Markets soared nearly 10% after the trading platform posted a 52% jump in its annual adjusted pre-tax profit.

Tate & Lyle fell 1.6% after the London-headquartered food ingredients maker entered into an agreement to buy U.S.-based CP Kelco for $1.8 billion from J.M. Huber Corporation. Its shares were also trading ex-dividend. Precious metal miners were the top gainers among FTSE 350 sectors as bullion prices climbed to a two-week high on softer U.S. economic data.

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