FTSE hits six-month high on QE3

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The FTSE continued to make huge gains in afternoon trading, reaching its highest level since late March after the Federal Reserve unveiled its third round of quantitative easing.

Fed chairman Ben Bernanke's latest round of stimulus comes in the form of an open-ended package to stimulate the housing market with the purchase of $40bn of mortgage-backed securities per month. The miners and the banks led the FTSE to its six-month peak, the index reaching 5,911 by mid-morning, up 1.52%. The news also lifted stock markets across Europe to their highest level in 14 months. RBS, Barclays and Lloyds were all up over 3% as RBS announced this morning it is to launch an initial public offering of its Direct Line Insurance Group, completing one of the conditions of its £45...

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