Exporter-heavy FTSE 100 soars as BoE growth forecast cut hurts pound

London's FTSE 100 swiftly climbed to a session high as its international stocks got a lift from a hit to sterling after the Bank of England cut its economic growth forecast, adding on to earlier cheer that was brought on by the Fed's softer stance.

The FTSE 100 index was up 0.7% with BP and Shell both up more than 1% after Middle East tensions drove crude prices higher, while the FTSE midcap index was up 1% at its highest in a month by 1154 GMT.

The pound trimmed gains after the BoE cut its growth forecast to zero in the second quarter and highlighted risks from global trade tensions and growing fears of a no-deal Brexit.

"With the US Federal Reserve now striking a more dovish pose as it also sees rising downside risks in the global economy, we shouldn't entirely rule out the possibility the next interest rate move may be downwards," Laith Khalaf, Hargreaves Lansdown analyst, said.

The BoE statement lifted hopes of more stimulus further, after the US Federal Reserve's statement late on Wednesday fed expectations that a decade-long global rally for stock markets may not quite have run out of steam.

Precious metals miner Fresnillo led gains with a 5.2% rise, having earlier jumped as much as 7%, as gold prices hit their highest in more than five years after the statement.

London-listed shares in cruise operator Carnival slumped 8% after the company cut its profit forecast due to the Trump administration's sudden ban on cruises to Cuba and higher expenses.

Russian steelmaker Evraz fell nearly 5% after a discounted share sale, while United Utilities lost 4.1% as its stock moved ex-dividend.

Among midcaps, car auction group BCA Marketplace surged 21% after saying it was in talks with private equity firm TDR Capital on a 1.91 billion pounds buyout offer.

Dixons Carphone recouped some losses to be down 11.3% at a decade-low, after earlier plunging nearly 30%, as it reported a slump in full-year profit and pointed to worse to come as it struggles in a fierce mobile phone retail market.

In contrast, homewares retailer Dunelm climbed to a three-year high after it raised its earnings forecast for the second time in just over two months while clothing retailer N Brown Group jumped 6.2% on results.