Banks boosted by stimulus hopes

The FTSE 100 remains on course to clock up its 10th day of gains with banks bringing much of the cheer.

This morning's glum economic data - showing GDP dropped a much bigger than expected 0.8% - failed to push equity traders into sell mode. Instead it has put the banks in demand by raising hopes the Bank of England will continue measures to stimulate the economy.

Philip Shaw, economist at Investec, weighs up the pointers on where the Bank's Monetary Policy Committee may go next with its quantitative easing.:

"Today's numbers put the cat among the pigeons in the QE debate. Following the July MPC minutes and Andrew Sentance's recent remarks, the prevailing view seems to be that the MPC will pause.

"However on balance, medium-term economic risks and a subdued inflation outlook suggest a further increase next month."

His sentiments were echoed in the market with Royal Bank of Scotland, Standard Chartered, interdealer broker ICAP and Schroders all among the top risers on the FTSE 100.

Miners are the other top performers in afternoon trading thanks to most rises for most metal prices with copper hitting a nine-month high. Oil prices are also higher, helping the likes of BP and and Royal Dutch Shell to do their bit for the FTSE 100's winning streak.

That leaves the FTSE 100 up just over 21 points, or 0.5%, at 4,581. With US futures pointing to another bright start on Wall Street the FTSE 100 looks likely to hold onto its gains this afternoon. That will mean it has achieved 10 straight sessions of gains, the longest winning run since late 2003.