Market overview: FTSE closes up 6 at 5,852
Posted on: 09 Aug 2012 by Polly York

1630: The UK trade deficit hit a record 28.3bn pounds in the second quarter, according to figures released by the ONS today. They showed exports dropped by 4.9% as a slowing global economy made life difficult for British firms selling abroad. Imports also slipped, but only by 0.5%. Meanwhile, the number of house repossessions hit a 16 month low in the second quarter, but the good news came amid warnings that the current pattern of stability may result in more people having to hand back their houses later on. The number of possessions in the first six months of 2012 totalled 18,100, down from 9,600 the previous quarter in line with previously seen seasonal patterns. In the US, jobless claims fell unexpectedly to 361,000 last week. Economists had been predicting a rise to 370,000. The FTSE closed up six points at 5,852.

1426: The number of house repossessions hit a 16 month low in the second quarter, but the good news came amid warnings that the current pattern of stability may result in more people having to hand back their houses later on. The number of possessions in the first six months of 2012 totalled 18,100, down from 9,600 the previous quarter in line with previously seen seasonal patterns. FTSE 100 is down seven points at 5,839.

1340: The Footsie continues to sit in the red despite the rebound by financial group Standard Chartered. Weighing heavily on the index is engineering and consultancy group AMEC after it admitted it was concerned over falling margins. In the US jobless claims fell more than expected, registering a decline of 6,000 to 361,000 for the week ended August 4th. Analysts had been expecting a gain of around 370,000. FTSE 100 is down three points at 5,843.

1235: Footsie remains slightly on the back foot despite the continued recovery of scandal-hit bank Standard Chartered. Among the mid-caps, grocery delivery firm Ocado is sharply lower after UBS more than halved its price target for the stock from 110p to 51p. The broker has switched its view to ‘sell’ from ‘neutral’ to reflect a ‘more sober assessment of the business’s earnings potential.’ FTSE 100 is down 12 at 5,834.

1155: The Footsie has swung into the red after a positive start, down seven points at 5,834, but continues to trade within a narrow range of just 19 points this morning. Dampening sentiment today has been the ECB which cut its GDP growth forecasts for this year and the next to from -0.2pc and 1.0pc to -0.3pc and 0.6pc, respectively. Miners are continuing to perform well, led by Randgold after its first-half results. Glencore, Antofagasta and Xstrata are also higher after cooling Chinese inflation data sparked hopes that the government may inject additional stimulus, boosting the demand for commodities. AMEC is continuing to provide a drag after warning that while margins will improve in the second half, they will be lower year-on-year.

0944: The UK’s goods trade deficit widened to a record level of 28.3bn pounds in the second quarter of 2012 from a deficit of 25bn pounds in the first quarter. The UK’s deficit on trade in goods and services was 4.3bn pounds (seasonally adjusted) in June, versus a deficit of 2.7bn pounds in May. The goods trade deficit in June widened to 10.1bn pounds from 8.36bn in May, and was much worse than the 8.63bn deficit the market had been expecting. What used to be called ‘invisible’ earnings – i.e. services revenue – chipped in with a surplus of 5.8bn pounds. Sterling fell against the dollar on the news, dipping to 1.5644 against the greenback.

0935: AMEC’s shares are getting duffed over, as the oilfield services group announced a fall in margins in the first half of the year. The company tried to put a positive spin on the development, saying the fall was expected, and that margins will improve in the second half, but the fact is that the full-year margin will still be lower than in 2011, and this has made the market a little uneasy. Mid-cap miner Bumi is also getting a good going over after it revealed that heavy rainfall had put a dampener on its first half results. Footsie remains disinclined to stray far from last night’s level. FTSE 100 is down 7 at 5,839.

0834: Gold miner Randgold claimed to be ‘firing on all cylinders’ in its interim results statement this morning, and judging by the positive share price reaction, the market agrees. As Standard Chartered hits back at the New York regulator which accused it of money laundering, the share price continues to recover from Tuesday’s plummet. Oilfield services firm AMEC is letting the side down, however, as the shares sink following a disappointing trading update this morning. FTSE 100 is up 3 at 5,849, having fallen back from its intra-day high of 5,860.

Tags: amec | footsie | FTSE | global economy | house repossessions | jobless claims | mid caps | seasonal patterns | second quarter | trade deficit