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FTSE100 closes lower as Carney's comments spook traders

FTSE100 did not manage to get into positive territory on Thursday and closed down around five points...

FTSE100 did not manage to get into positive territory on Thursday and closed down around five points at 6,747.

Equity traders were put off by the potential of a UK interest rate rise drawing near following the words of the Governor of The Old Lady of Threadneedle Street, Mark Carney, who said somewhat enigmatically a rate rise was "drawing closer".

The central bank decided to keep UK rates at the bargain basement level of 0.5% for the 78th consecutive time.

"The likely timing of the first bank rate increase is drawing closer. However the exact timing of the first move cannot be predicted in advance," Carney said at a press conference.

Many analysts however suggested the rise was unlikely to be before 2016.

While those who had managed to make it into City desks were marveling at the bowling performance of Stuart Broad, FTSE never quite got motoring.

Resource stocks were pummelled by the fall in commodities, with BP (LON:BP.) dropping 3% to 1,055p and Anglo American (LON:AAL) easing 2.84% to 775.4p.

Ahead of US non-farms tomorrow, on the macro front, there was disappointing news from UK manufacturing, with official figures showing sector output fell 0.3% in the second quarter despite production rising 0.2% in June.

After losing earlier Miner Rio Tinto (LON:RIO) regained 0.31% to 2,575.5p after blaming lower iron ore prices for a big profit dip.

Randgold Resources (LON:RRS) added 0.81% to 3,864p despite news of a quarterly gold production record.

Shares in GlaxoSmithKline (LON:GSK) were 2.68% to 1,457p on market talk of a potential £98bn takeover by US rival Pfizer or Swiss drug group Novartis.

Takeover target RSA Insurance (LON:RSA) was 2.67% lower to 510p despite reporting progress in its recovery drive and reinstating its dividend.

Aerospace engineer Cobham (LON:COB) flew 6.55% higher to 279.7p as it posted higher orders, revenue and profit.

Investors in Enterprise Inns toasted a rise in sales as good weather encouraged people to visit the pub. Shares lifted 3.57% to 118.8p.

Among small caps, Sound Oil (LON:SOU) said a gas sales deal has now been signed for the Nervesa gas field with Shell Energy Italia. Shares surged 11.02% to 16.375p.

Meanwhile, Cloudbuy (LON:CBUY) signed a memorandum of understanding (MoU) with the government of the city of Yiwu in China to help its wholesale marketplace promote itself overseas. Shares climbed 3.8% to 20.5p.

Conversely, shares in troubled firm Quindell (LON:QPP) slumped over 28% to 89.5p as trading resumed for the first time in more than a month today.

The Serious Fraud Office (SFO) has opened an investigation into the company which is believed to relate to past business and accounting practices.

Other notable risers were mining group Stratex (LON:STI), which gained almost 34% to 1.88p and Premier African Resources (LON:PREM), which added 29.49% to 2.53p.

This week it said it had shipped the first concentrate from its RHA tungsten mine in Zimbabwe, with steady state production expected once a plant upgrade is complete.

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