Markets: HSBC growth downgrade halts rally

Cautious traders banked their recent gains yesterday as central bankers continued to give off mixed messages and HSBC downgraded its global growth forecast due to the recent turmoil in emerging markets.

The FTSE 100 closed 27.93 points lower at 6,215.47, making for a good week but a bad month. Around £2.3 trillion was wiped off the value of UK blue chips in June, despite a fightback of around 4 per cent this week.

William Nicholls, dealer at Capital Spreads, said: “As the last business day of the half year comes to an end, unsurprisingly, some positions [are] being taken off the table. This, combined with hawkish comments by Fed members is causing the markets to move into negative territory.”

Outsourcing firm Serco was the biggest riser, adding 3 per cent or 16p to 616.5p after it said first-half revenue growth had been ahead of its expectations. And builder Persimmon was up 2 per cent at 1,181p ahead of an update next week. Analysts say sales figures should start showing the impact of George Osborne’s latest stimulus measures.

But a further plunge in the price of gold sparked falls for some mining stocks. The precious metal slumped to its lowest level in nearly three years, hit by concerns over the Fed’s plans to rein in quantitative easing.

Mexican gold and silver miner Fresnillo clawed back hefty early session losses, closing flat at 882p, although fellow mining stocks Eurasian Natural Resources and Antofagasta dropped 7.8p to 204p and 21.5p to 795p respectively.

Among the Scottish stocks, Stagecoach chief executive Martin Griffiths sold some £535,114 worth of shares that vested on Thursday and Friday under long-term incentive plans at the transport operator. The shares were down a fraction at 315.3p.

NEW YORK: Wall Street last night closed its strongest first half of the year since 1998 after record highs in May on a rally underpinned by the Federal Reserve’s massive monetary stimulus.

But on the day, the Dow Jones industrial average fell 114.89 points or 0.76 per cent, to end at 14,909.83 while the S&P 500 slipped 6.92 points or 0.43 per cent, to finish at 1,606.28. The Nasdaq Composite added 1.38 points or 0.04 per cent, to close at 3,403.25.