London slides as BoE rate hold does little to inspire

A lacklustre start to US trading, profit taking and a subdued

performance from miners also weighed on the top flight and the FTSE 100 Index ended the day 6.05 points lower at 5527.16.

But the market maintained its position above the 5500 barrier – which it broke through on Wednesday for the first time in six weeks.

Meanwhile, the index containing more UK based companies – the FTSE 250 saw improving fortunes yesterday, climbing 53.12 points, or 0.6 per cent.

The Bank of England's decision not to extend its 200bn money-boosting quantitative easing programme and to hold interest rates at their record low of 0.5 per cent did not come as a surprise.

The European Central Bank also left rates unchanged at 1 per cent and confirmed that it will continue to scale back special lending measures it introduced during the financial crisis.

In the US focus turned to the country's economic future as investors await unemployment figures due out today. The key report is expected to show that joblessness rose to 9.8 per cent in February, as employers cut 50,000 roles. The Dow Jones Industrial Average rose 0.1 per cent in early trading.

The number of US workers filing for jobless benefits fell last week, but a surprise decline in January pending home sales contracts to a 10-month low underscored the slow nature of the economic recovery. Initial claims for state unemployment benefits dropped 29,000 to a seasonally adjusted 469,000, the Labor Department said. That was in line with market expectations.

A separate report from a Realtors group showed pending sales of

existing homes dropped 7.6 per cent in January to their lowest since March last year. Markets had expected pending home sales, which lead existing home sales by a month or two, to rise 1 per cent.

The pound, meanwhile, fell back to 1.50 against the US dollar as it struggles to recover from a recent hammering.

Financial firms were on the front foot after Standard Chartered finished the bank reporting season on a positive note on Wednesday with profits ahead of market expectations.

Standard Chartered rose 261/2p to 17001/2p yesterday, while Royal Bank of Scotland added 11/2p to 393/8p and Lloyds Banking Group finished the session 11/8p better off at 537/8p.

Those on the back foot included Amec after the engineering and support services firm reported a fall in revenues and profits and said it expected 2010 to be another challenging year. Shares in the group, which is focused on the oil and power generation sectors, fell 7 per cent, or 55p, to 7651/2p.

Results elsewhere received a better response as FTSE 250 Index

newspaper group Trinity Mirror improved 9 per cent in the wake of its annual results, which showed a decline in profits to 72.7m.

With the company reporting encouraging signs in advertising revenues, shares rose 93/4p to 1553/4p.

VT Group also rose 91/2p to stand at 685p after it ended its pursuit of rival Mouchel in order to concentrate efforts on defending itself against an unsolicited approach from Babcock International.

VT and Babcock later revealed they had agreed the basis for a "mutual exchange" of information. Mouchel fell 93/4p to 2031/4p and Babcock dipped 17p to 518p.

Whitbread fell 5p to 1472p despite reporting like-for-like sales up 3 per cent in the fourth quarter to February 18.

The biggest Footsie riser was Schroders up 74p to 1310p.