Hope of cut sends shares soaring

HOPEs of deep interest rate cuts on both sides of the Atlantic sent the stock market soaring today.

After half an hour's trading the FTSE-100 stood at 4132.3, up 205.92 points, or 5.2 per cent.

It follows an 889-point rally in the Dow Jones Index last night, the second biggest rise ever on Wall Street. Asian share markets also rose sharply last night.

America's Federal Reserve is expected to announce a cut in interest rates tonight from the current level of 1.5 per cent. Some analysts have suggested they could be halved to 0.75 per cent to boost the economy.

The stock market in London is also starting to factor in the possibility of a full point off interest rates next week.

The base rate currently stands at 4.5 per cent following a co-ordinated global cut at the height of the financial crisis.