London shares open lower as BOE minutes, ex-div weigh

London shares open lower as BOE minutes, ex-div weigh

	Published : Wed, 18 Apr 2007 08:41 By : Agencies Print this Story

LONDON (Thomson Financial) - Leading shares opened lower as caution ahead of the Bank of England's latest rate setting minutes, the ongoing strength of the pound, and ex-dividend factors offset a solid performance on Wall Street overnight, dealers said.

At 8.15 am, the FTSE 100 was down 16.4 points at 6481.4 with the broader indices mixed.

Being a Wednesday, ex-dividend factors helped to drag down blue chips shaving around 3.3 points off the FTSE 100, with Legal & General, BAE Systems, Reed Elsevier, ITV and Slough Estates all hit.

Furthermore, investors were sidelined ahead of the release of the minutes from the Bank of England's Monetary Policy Committee on April 5, when rates were left on hold at 5.25 pct.

Last month's minutes revealed a surprise 8-1 vote in favour of leaving rates on hold, but yesterday's jump in March annual CPI inflation to 3.1 pct left the market convinced another quarter point hike next month is a certainty.

Meanwhile, last night the DJIA flirted with record levels after a rise in home construction data and mild consumer inflation eased fears over the health of the economy.

Sentiment was further underpinned by forecast-busting results from the likes of Coca-Cola and Johnson & Johnson.

The DJIA ended 52.58 higher at 12,773.04 and the S&P rose 3.01 to 1,471.48.

But the dollar slumped to a 15-year low against sterling this morning on expectations the US will begin cutting interest rates while the latest data from the UK suggests a May rate hike is a certainty.

And in Asia, Tokyo's Nikkei 225 index ended the morning session 121.21 firmer at 17,648.66, while Hong Kong's Hang Seng index was 12.97 firmer at 20,801.58 by midday.

Still in Asia, crude prices clawed back some of yesterday's losses, supported by worries over tight gasoline supplies in the US.

Earlier this morning, New York's main oil futures contract, light sweet crude for delivery in May, was 18 cents higher at 63.28 usd a barrel, having dropped 51 cents on Tuesday.

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