* BoE hikes bank rate by 50 bps, biggest hike since 1995
* Unilever down as Ben & Jerry's says it froze directors'
* Medtech company ConvaTec leads gains among midcaps
* FTSE 100 flat, FTSE 250 adds 0.7%
Aug 4 (Reuters) - The FTSE 100 stock index was little
changed on Thursday as investors weighed the biggest interest
rate hike from the Bank of England in 27 years, which raised
fears of a looming recession even as it weighed on the pound.
The British central bank's Monetary Policy Committee voted
8-1 for a half percentage point rise in Bank Rate to 1.75% - the
highest level since late 2008.
"The Bank of England has clearly decided that now is the
right time to bring out more firepower and raise rates by 0.5%
for the first time since 1995," said Paul Craig, portfolio
manager at Quilter Investors.
"It has clearly taken note of what the Federal Reserve is
doing in the U.S. and feels it could be running out of time to
grapple inflation and get it under control."
The BoE's move weakened the pound and helped lift the
blue-chip FTSE 100 index to session highs moments after
the decision, but the index closed the day flat.
The domestically focussed midcap index was up 0.7%.
"The pound's slump in the wake of today's MPC decision
underlines the caution investors have regarding the UK economy,"
said Chris Beauchamp, chief market analyst at online trading
Even as recession fears mount across the world, UK stocks
have fared better than their peers so far this year.
Shares of Unilever Plc slipped 0.7% after Ben &
Jerry's independent board said the company had frozen its
directors' salaries last month as a pressure tactic.
Rolls-Royce dragged down the aerospace and defence
sector, tumbling 9% even as the aero-engineer
said it would see its squeezed operating profit margin improve
in the second half.
Gold miner Centamin Plc rose 7.3% after it reported
a 4% rise in its first-half revenue supported by higher bullion
Medical technology company ConvaTec jumped 6.8%,
among midcap gainers, after reporting higher first-half
(Reporting by Shreyashi Sanyal in Bengaluru; Editing by
Shinjini Ganguli and Bernadette Baum)