UK Equities Slide Lower

In a widely-anticipated decision, the Bank of England opted to maintain its benchmark interest rate at 0.25%. However, the vote tally to keep the rate unchanged was only 5 as the number of dissenting views rose to 3.

Analysts had forecast only one BoE member voting in favour of a rate rise, in-line with the May meeting. Data points released earlier this week have shown UK inflation surging close to 3.00% alongside average wages falling and retail sales dropping, evidence of the growing inflationary impact on growth and economic activity.

The Central Bank also reaffirmed the size of its asset purchase program at GBP 435 billion and its corporate bond purchase program at GBP 10 billion.

The kneejerk reaction to the decision sent FTSE 100 futures tumbling to 7314 last session before mounting a pullback in early Friday trade.

After months of gains in, homebuilders in the US are feeling less optimistic this month according to data from a leading survey.

The National Association of Home Builders Sentiment Index declined to 67 in June from a downwardly revised 69 in May. Of the index's major components, ongoing sales conditions shed 2 points to 73, while sales expectations over the coming six months lost 2 points to 76.  Since the start of the year, homebuilders have been benefiting from increased demand.

As the market strengthens and more buyers enter, builders are beginning to grapple with a shortage of skilled workers and land plots cleared for home construction. However, should upcoming building permits and housing starts figures come in weak again, it could be a sign of the housing market echoing the reduced confidence of homebuilders.

An upside rebound late on Thursday’s session has seen the Nasdaq Composite extend the run higher ahead of the European session, with futures trending around 5725.