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Banks lead FTSE higher as Fed prepares rate rise

Banks lead FTSE higher as Fed prepares rate rise

Banks have driven the FTSE 100 higher, buoyed by better-than-expected new rules for the sector unveiled last week and ahead of an expected interest rate rise by the US Federal Reserve.

The UK blue-chip index rose 50 points, or 0.7%, to 7,444, with lenders among the risers. 

HSBC (HSBA) was up 2.1% at 748.3p, also receiving a boost from the US Department of Justice's lifting of its deferred prosecution agreement over anti-money laundering controls.

This means the bank will not face the threat of further penalties relating to its failure to prevent Mexican drug cartels laundering hundreds of millions of dollars.

Standard Chartered (STAN) was up 1.7% at 772.5p and Barclays (BARC) rose 1.3% to 199p.

Miners also made gains after trade data from China, the world's top metals producer, beat forecasts.  

Rio Tinto (RIO) rose 2% to £35.39, Glencore (GLEN) was up 1.8% at 351.9p and BHP Billiton (BLT) rose 1.8% to £13.66.

It was the same story on the FTSE 250, where Hochschild Mining (HOCM) rose 7.6% to 238.8p, Acacia Mining (ACAA) was up 6.8% at 177.8p and Vedanta Resources (VED) added 6.3% to 679p.

Telecommunications groups TalkTalk Telecom (TALK) and Inmarsat (ISA) slumped to the bottom of the index, down 9% at 140.6p and 7.4% lower at 449.9p respectively, both hurt by negative broker notes.

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