As predicted the CBI today downgraded its UK growth outlook as uncertainty ahead of the EU referendum weighs on investment plans. BUSINESS’S OFFICIAL FRIEND lowered its growth outlook to 2% for both 2016 and 2017. The projection for 2016 was lowered from 2.3% and that for 2017 from 2.1%. The ink was hardly dry on the CBI’S communiqué before George Osborne, the Chancellor, warned the country that to forsake the EU’S Single Market would be a ‘one way ticket to a poorer Britain. Who could blame us for thinking wrist watches had been synchronised or perhaps the Berliner Philarmoniker’s maestro, Herbert Von Karajan had been reincarnated to conduct the orchestration of these profound statements. If Armageddon is around the corner, why haven’t gilt yields set off for the moon? Then came the icing on the cake! – “Britain will lose £200bn in trade if voters back Brexit in EU referendum”, says George Osborne as Ed Balls and Vince Cable join him on campaign trail! Are those two credible or successful luminaries in the economic space? If I was a ‘BREXITER’ I think I might see right through those initiatives!
The FTSE 100 was out of sorts when the flag went up at 8.00am this morning – down 50 points at 6085. New York had closed on a sour note at the end of the week with retailers leading the journey south with the three main indices circa losing about 1%. So there was little to get the investment juices going. Despite the fact that markets are full of inertia, the FTSE has managed to nick back 30 points from various sectors to stand at 6115 – down 20 points at 1.35pm.
Which sectors mitigated some of the loss? Miners and gold stocks have been good all day with Anglo American leading the charge +5%. Of course Lonmin, from a very poor base are up 19% on good numbers. Oils on the back of crude have been firm, particularly the second liners like Tullow and Premier. House builders continue to impress. It was Crest Nicholson’s turn – +4.75%. British Land eased by 1.5% having been in positive territory and the start of the session and ICAP, soon to be called NEX, after it has completed the sale of its voice broking operation to Tullett Prebon, posted OK numbers, though the outlook, according to CEO Michael Spencer was challenging. The shares started the session down 1%, but are up 0.5% at the time of