FTSE flat as manufacturers signal slowdown

Exchanges were largely flat in London today, as disappointing manufacturing figures cancelled out rate cut expectations.

At the close, the FTSE 100 was 44.90 points, or 1.03 per cent, up on the day at 4422.24.

Earlier in the day, the CIPD/Markit manufacturing index had been released, showing the weakest reading for UK industry since the survey began 16 years ago, the BBC reports.

Slowing industrial activity is likely to put extra negative pressure on GDP – which has already shrank by 0.5 per cent over the past quarter.

The survey''s results is also likely to redouble calls for the Bank of England to reduce its lending rate.

Policymakers meet later this week – and are expected by analysts to cut the rate by 50-100 basis points from its current level of 4.5 per cent.

Elsewhere, investors remain very wary of buying stocks – with the FTSE 100 falling by ten per cent over October in one of its worst-ever months.

David Buik, a strategist at BGC Partners, told Reuters: "The market is still extremely nervous. You had four positive sessions in a horrific economic climate…I wouldn''t be all too surprised to see the market pause for reflection today."

He added: "People are obviously waiting whether we are going to just get [rate cut of] a half per cent [or] whether we are going to see some inspiration by cutting it by one per cent to give borrowers some impetus."