CLOSER
Britain's top share index closed down 37 points on Thursday as traders took flight over China worries and there were sharp losses in the US.
FTSE 100 finished the session, down 0.59% at 6,365 with big cap miners however making gains.
In the US, the Dow Jones was down a whopping 226 points and the Nasdaq down 90 as tech stocks suffered and traders are really unsure which way to turn on a possible Fed rate rise in September and as often said, markets hate uncertainty.
Markets headed lower as investors take flight at the Chinese gloom, where the sell-off in equities continued. Shanghai closed out at 3,664 - 129 points lower, or 3.42%.
It comes as in Greece, which received its first bailout tranche today and made a repayment to the ECB, the leader Alexis Tsipras is expected to announce imminently whether he will take the country to general elections as he has faced rebellion from within his Syriza party recently.
Joshua Mahony, at IG, said: "Greece wants to remain within the eurozone and receive creditor funding while rejecting austerity. Something has to give.
"The snap election highlights the fact that even when the deal has been agreed and signed off, stability may never return to Greece as long as austerity is on the cards. Should Mr Tsipras leave parliament, there is the possibility that a more hard-line replacement could take things back to square one."
Meanwhile, firmer metals prices saw Footsie miners do well. Randgold Resources (LON:RRS) was top dog, adding 5.72% to 4,252p.
Packaging group Mondi was the biggest loser - down 3% to 1,487p.
Shares in Premier Oil (LON:PMO) backtracked 0.15p to 96p as it blamed write-offs for a dip into the red but later shares soared 16.69% to 112.2p. The group said it was well placed despite the fall in crude prices.
High Street stationer WH Smith (LON:SMWH) fell 1.4% to 1,648p despite a forecast of slightly higher-than-expected annual results.
Kaz Minerals (LON:KAZ), formerly known as Kazakhmys, jumped 13.55% to 176.8p after it forecast zinc and silver output at the top end of expectations and maintained its guidance on copper for 2015. Analysts said the rise was also due to the devaluation of the Kazakhstan tenge.
Shares in Vast Resources (LON:VAST) rose 8% to 1.35p as it commissioned the plant at its Pickstone-Peerless gold mine and earmarked first gold production and sales for the end of this month (August).
It marks a further milestone in this firm's transition into a cash generative mining company.
Shares in ITM Power (LON:ITM) added 5.45% to 29p each as the company reached another goal - the Thüga group's power-to-gas plant in Germany has qualified to offer secondary balancing power.
ITM provided the electrolyser to the plant in 2013.
Another notable riser was Copper Development Company (LON:CDC), up 29.41% to 1.10p.
US OPEN
Having fallen two days in a row, there was no sign of a change of fortunes for US investors.
The Dow Jones was down 136 points at 17,213 in the first 15 minutes of trade as the market tried to get to grips with yesterday's statement from the Fed's policy-making committee and absorbed the weekly jobless stats.
The broader-based S&P 500 was off 17 points at 2,080 while the tech-heavy was down 40 points at 5,019.
"The build up to the first rate hike from the US is starting to get tortuous; the market wants clear direction from the Fed, but the Fed is resisting it," suggested Kathleen Brooks, at foreign exchange platform, Forex.com.
"Our view is that the decision will come down to the wire, with the market lurching at key employment, wage and inflation data between now and then," she added.
Jasper Lawler, a market analyst at spread betting firm CMC Markets, was equally baffled by the smoke signals emanating from the Federal Open Market Committee's (FOMC) hut last night.
"What the Fed is doing at the moment is almost the worst of both worlds for markets; it’s saying it wants to tighten monetary policy but the economy is not strong enough. The markets currently have neither the prospect of sustained loose monetary policy nor economic strength to fall back on," he suggested.
Meanwhile, the foreign exchange markets continue to experience a wild ride, with Kazakhstan opting to let its currency, the tenge, find its own level, particularly against the Chinese renminbi and the Russian rouble - Kazakhstan's two biggest trading partners, both of which have seen their currencies devalue swiftly in recent weeks.
Back in the USA, as Chuck Berry once sang, first-time jobless claims rose for the fourth week in a row, but remained below the 300,000 level that is regarded as a crossover point in terms of indicating the health of the economy.
Claims rose by 4,000 to a seasonally adjusted 277,000 in the week to August 15, the highest level since early July.
Though there was plenty of blood in the street, there were some bright spots to be found, such as drugs firm Eli Lilly (NYSE:LLY), which was up US$4.77 to US$88.51 after its EMPA-REG OUTCOME study reached its primary endpoint.
The long-term clinical trial is investigating cardiovascular outcomes for the Jardiance drug in more than 7,000 adults that have type 2 diabetes.
The primary endpoint was defined as time to first occurrence of either cardiovascular death, or non-fatal myocardial infarction or non-fatal stroke.
Sector peer Valeant Pharmaceuticals (NYSE:VRX, TSE:VRX) was down in the dumps on reports it is to splash out US$1bn on Sprout Pharmaceuticals, a company that has just been granted permission to sell pills dubbed as the female version of Viagra.
Valeant's shares drooped 2.4% to US$238.76 in early trading.
Elsewhere, The Madison Square Garden Company's (NYSE:MSG) results proved not to be a crowd-pleaser.
The company reported a fourth quarter net profit of US$45.7mln, up from US$11.6mln a year earlier.
Earnings per share of 60 cents were four times the previous year's level, and well ahead of the 39 cents forecast by analysts who cover the stock.
Despite this, and moving higher in pre-market trading, the stock was off 2.6% at US$74.43.
Also getting a tonking were the shares of Verso (NYSE:VRS), after the paper & pulp firm announced plans to reduce production capacity.
The company plans to mothball its mill in Wickliffe, Kentucky, and make cutbacks elsewhere that will result in its production capacity being reduced by 430,000 tons of coated paper and 130,000 tons of dried market pulp.
The shares were pulped, fall just over 9% to 30 cents.
Retailer Sears Holdings (NASDAQ:SHLD), which saw its shares sold off heavily yesterday, was in the doghouse again this morning after its second quarter results failed to impress.
The company performed a sleight of hand, appearing to move back into the black, but this was only achieved as a result of one-off gains from asset sales.
The top line continues to head south, as does the share price - off 6.3%.
FTSE LUNCH
UK shares, along with global indices, were decidedly lower on Thursday as UK retail sales numbers put a dampener on sentiment but China was the big trigger.
FTSE100 is down around 37 points, or 0.63% to 6,363 at the time of writing.
Despite positive manufacturing data for August, the UK retail sales figures for July fell short of analysts' expectations.
They increased 4.2% in July compared to a year ago, but the experts had expected a 4.4% increase.
Markets are heading lower as investors take flight at the Chinese gloom, where the sell-off in equities continues. Shanghai closed out at 3,664 - 129 points lower, or 3.42%.
Greece received its first €26bn tranche of its €86bn bailout and made a €3.2bn repayment to the ECB, but traders focused instead on China.
David Madden, at IG, said: "Stock markets around Europe are suffering because the decline overnight in the Far East has spooked dealers in the West.
"The great worry is that China will undergo a dramatic drop in the rate of growth, and the knock-on effect to Europe will damage the recovery. It used to be just Australia that would catch a cold when China sneezed, but the Chinese sell-off is far more infectious than initially thought."
To company matters, and big cap miners who were enjoying rises as metals prices firmed. On Footsie the biggest gainer was Anglo American (LON:AAL), up 4.86% to 743.9p.
Packaging group Mondi was the biggest loser - down 2.61% at 1,494p.
Oil price slides sent the big oil firms down. BP (LON:BP.) shed 0.10% to 367.15p. Royal Dutch Shell (LON:RDSB) leaked 0.06% to 1,739p while BG Group (LON:BG.) lost 0.91% to 1,036p.
Shares in Premier Oil (LON:PMO) backtracked 0.15p to 96p as it blamed write-offs for a dip into the red but later shares lifted 6.6% to 102.5p. The group said it was well placed despite the fall in crude prices.
High Street stationer WH Smith (LON:SMWH) fell 1.08% to 1,553p despite a forecast of slightly higher-than-expected annual results.
Kaz Minerals (LON:KAZ), formerly known as Kazakhmys, jumped 13.17% to 176.20p after it forecast zinc and silver output at the top end of expectations and maintained its guidance on copper for 2015. Analysts said the rise was also due to the devaluation of the Kazakhstan tenge.
Shares in Vast Resources (LON:VAST) rose 8% to 1.35p as it commissioned the plant at its Pickstone-Peerless gold mine and earmarked first gold production and sales for the end of this month (August).
It marks a further milestone in this firm's transition into a cash generative mining company.
Shares in ITM Power (LON:ITM) added 5.45% to 29p a pop as it reached another goal - the Thüga group's power-to-gas plant in Germany has qualified to offer secondary balancing power.
ITM provided the electrolyser to the plant in 2013.
Another notable riser was Copper Development Company (LON:CDC), up 29.41% to 1.10p.
MOST FOLLOWED
Co-op Bank, Tesla and taxi app business Uber were among the news themes piquing interest on the web Thursday, as Footsie and other global indices suffered further losses.
Ever controversial, Uber was back making headlines as it was alleged that the firm missed the criminal records of drivers hired in the US and also revealed a massive investment from Tata.
The backgrounds of 25 people were missed, including allegedly, a murderer, who slipped through the net. It is claimed he joined Uber in 2014 using a fake name, and gave 1,168 rides before being discovered.
Meanwhile, on a more positive note, the Indian business giant Tata is putting in an eye-watering US $100 million as the taxi concern wants to develop new products and services in India - the biggest market outside the US.
Meanwhile, the troubled Co-op Bank was also gaining traction in the news stakes, revealing big losses in its first half and warning that the company will remain in the red until 2017.
It comes after a damning report last week found it misled investors and kept regulators in the dark as it came close to collapse.
As reported yesterday, Buzzfeed has 200 million reasons to be happy after cable broadcaster NBC Universal has invested US$200mln in the young social media and Internet group.
NBC owner Comcast is looking to ramp up its digital offering and appeal to a younger audience and the investment now values Buzzfeed at around US$1.5bn.
In 2014, the company said it took in around US$100 million in revenue.
Excitement in the electric car world is building as Tesla motors launch of the Model X is now within six weeks, it emerged.
Currently, the car is undergoing testing by Tesla engineers. In a letter to Tesla shareholders, Elon Musk, the CEO, said he does not expect the vehicle to be mass produced until the last quarter of 2016
LONDON OPEN
Wall Street woe and China turmoil eclipsed upbeat news on Greece on Thursday, hitting early trading in London shares.
US markets staged a brief rally on a surprisingly dovish set of Federal Reserve meeting minutes, but ended the session in the red on global economic fears.
The dollar slipped 0.4% after the Fed minutes sparked more uncertainty about the timing of a US interest rate hike.
Greece was set to get the first €26bn tranche of its €86bn bailout, but traders focused instead on another downbeat session in the Chinese stock market.
The Shanghai Composite index dropped nearly 4% in early trading and ended 3.4% off at 3,664.
Analyst Connor Campbell at spread-betting firm Spreadex said: "Another tumble by the Shanghai Composite merely reinforced the idea that the Chinese government is struggling to provide a tourniquet for its headline index."
The FTSE 100 Index dropped 24 points to 6,379 in the first hour of trading. Frankfurt's DAX fell 54 points to 10,627 and France's CAC-40 was also off.
In economic news, UK July retail sales data came in as expected with a 0.4% volume rise against June. US weekly claims and existing home sales data were due later.
The price of a barrel of US light crude fell below US$41 in early trading, while a barrel of Brent dropped to US$46.9.
That hit markets, in particular BP (LON:BP.), which dipped 1.2p to 366.3p. Royal Dutch Shell (LON:RDSB) leaked 3p to 1,737p and BG Group (LON:BG.) deflated 4p to 1,041.5p.
Shares in Premier Oil (LON:PMO) backtracked 0.15p to 96p as it blamed write-offs for a dip into the red.
Stationer WH Smith (LON:SMWH) fell 11p to 1,559p despite a forecast of slightly higher-than-expected annual results.
Kaz Minerals (LON:KAZ), formerly known as Kazakhmys, jumped 30.8p or 19.8% to 186.5p after it forecast zinc and silver output at the top end of expectations and maintained its guidance on copper for 2015. Analysts said the rise was also due to the devaluation of the Kazakhstan tenge.
MARKET PREVIEW
London’s FTSE 100 is expected to start the day just a few points on the negative side as the markets continue to interpret the latest inexact central bank commentary.
CFD provider IG Markets is calling the FTSE 100 open at 6,393 to 6,399.
Last night minutes from the US Federal Reserve extended uncertainty over when interest rates would be raised.
Many investors had previously anticipated September would be the month that rates begin to rise, but, the Fed highlighted question marks about a number risks to the economy; such as lagging inflation, commodity prices and Chinese volatility.
So, the market’s guessing game continues.
Craig Erlam, analyst at OANDA, said: “there was little to be learned from the minutes themselves and as is often the case, people seemed to simply take from them what they wanted to.
“The minutes can quite often leave themselves wide open to this kind of confirmation bias as they fail to commit either way.
“Some people are now adamant that the first hike will not come until next year while others claim September is still the likely lift-off date. In reality, it probably doesn’t matter either way as any hike is only going to be small.”
Wall Street last night saw the Dow Jones drop more than 160 points, 0.9%, to 17,348 while the S&P 500 gave up 0.8% to 2,079 and the Nasdaq lost a similar amount to 5,019.
In Asia the volatility continued amid further concerns over China, and as global investors withdrew funds from emerging markets in the region.
The Shanghai Composite shed nearly 1.2% to 3,748 while Hong Kong’s Hang Seng lost 1.5% to 22,819. Japan’s Nikkei was down 0.8%.
Australia’s ASX 200 fell 1.7% to 5,288.
In the commodities market Brent Crude Oil fell sharply, losing more than 4%, to below US$47 per barrel and West Texas Intermediary futures gave up 4.5% to US$40.77.
Gold’s haven appeal saw the yellow metal rise 1.2% to around US$1,140.
In London this morning the corporate diary features a number of popular FTSE 250 names.
Interims: Premier Oil (LON:PMO), Sportech (LON:SPO), Costain Group (LON:COST), UK Commercial Property Trust (LON:UKCM), Stock Spirits Group (LON:STCK), TT Electronics (LON:TTG), Kaz Minerals (LON:KAZ), New World Resources (LON:NWR).
Trading Update: WH Smith
Companies trading ex-dividend include: British American Tobacco (LON:BATS), Prudential (LON:PRU), Fidessa Group (LON:FDSA), Taylor Wimpey (LON:TW., Mondi (LON:MND).