FTSE 100 up 0.3, FTSE 250 adds 0.7
Bank of England cuts rates by a quarter point to 5
RollsRoyce shares hit record high after forecast raise
Shell gains after quarterly profit beat

Aug 1 Reuters London39;s FTSE 100 extended gains on Thursday after the Bank of England cut interest rates from a 16year high at its latest monetary policy decision, while positive corporate updates further uplifted the sentiment.

The bluechip FTSE 100 index was up 0.3, trading at highs last seen in May. The midcap FTSE 250 erased its losses and was last up 0.7 at its highest since February 2022 by 1130 GMT.

The BoE trimmed interest rates by a quarter point to 5 from a 16year high after a narrow vote in favour from policymakers, making it the first cut from the central bank since 2020.

However, BoE Governor Andrew Bailey said that the Monetary Policy Committee would move cautiously going forward, as policymakers were divided over whether inflation pressures had eased sufficiently.

The market pricing had moved towards a rate cut as well in the last few days, so, it was largely anticipated, said Hetal Mehta, head of economic research at St. James39;s Place.

The BoE have probably started a cycle that is going to be several rate cuts, but I wouldn39;t expect them to necessarily be back to back, Mehta added.

The pound fell to its lowest in a month, and was last down 0.7 against the U.S. dollar.

Ratesensitive sectors like homebuilders and real estate investment trusts jumped over 1 and…