Loop in pages not working

Hi,

I have a very simple loop, that placed in my index.php works perfectly. But, as soon as I set WP to a static front page, and then choose a page template (home.php in my case), the loop doesn’t work. I just can’t work it out, surely it’s exactly the same thing?!

I’m hosting locally, so can’t post any URLs, but I can post my loop code:

<?php while (have_posts()) : the_post(); ?>
		<div id="newswrap">

			<a href="<?php the_permalink() ?>" title="<?php the_title(); ?> - Arabella"><h2 class="floatleft"><?php the_title(); ?></h2></a>
			<a href="#" title=""><h3 class="floatright">more news...</h3></a>
			<a href="#" title=""><h4 class="clear"><?php the_time('jS F Y') ?></h4></a>
			<div class="blog-post-content"><!-- Start Post -->
				<?php the_content(); ?>
			</div> <!-- End Post -->
			<div id="sharepost">
				<a href="http://twitter.com/share" class="twitter-share-button" data-count="none" data-via="arabellamusicuk">Tweet</a><script type="text/javascript" src="http://platform.twitter.com/widgets.js"></script>
				<div id="facebook-share-button"><script src="http://connect.facebook.net/en_US/all.js#appId=208640855839088&xfbml=1"></script><fb:like href="http://facebook.com/arabellamusicuk" send="false" layout="button_count" show_faces="false" font=""></fb:like></div>
			</div>

		</div> <!-- End Newswrap -->
<?php endwhile; ?>

And without the markup:

<?php while (have_posts()) : the_post(); ?>
			<?php the_permalink() ?>
			<?php the_title(); ?>
			<?php the_title(); ?>
			<?php the_time('jS F Y') ?>
			<?php the_content(); ?>
<?php endwhile; ?>

Also, just to note, I’ve set a ‘posts’ page in the Settings > Reading section as just a blank page…

Thanks in advance!
James

[No bumping or bouncing, please.]