Miners remain under a cloud after disappointing Chinese manufacturing data was released overnight, but there was some cheer on the home front, as retail sales fell by less than feared in August.

UK retail sales fell by 0.2% in August, slightly less than the 0.3% fall expected by economists. In year-on-year terms total retail sales grew by 2.7% (Consensus: 2.9%), which was not such good news for retailers, and neither was the fact that the previous month´s year-on-year reading was revised down to show a rise of only 2.3%, instead of the preliminary estimate of 2.8%.

China´s manufacturing sector Purchasing Manufacturers' Index (PMI) for the month of September came in at 47.8 overnight, after 47.6 in August, for its longest streak below the 50 point threshold - which indicates economic contraction - in eight years.

Elsewhere in Asia, Japan's exports fell 5.8% year-on-year in August, for a third straight decline, on weakness in demand from the EU and China.

The Spanish Treasury debt auction passed without frightening the horses. The Spanish Treasury issued a total of €4.88bn in three and ten year bonds, surpassing its target of €4.5bn. There was strong demand for the Spanish bonds, keeping yields low enough to alleviate some pressure on Spain to request international aid, at least temporarily.

Spain issued 10-year bonds for €859m with a yield of 5.666%, well below the 6.647% demanded at the previous auction. The bid to cover ratio was 2.8 compared to 2.4 last time around.

As for the auction of three-year bonds, the market bought €3.94bn at a yield of 3.845%, slightly more than the 3.774% of the prior auction. The bid to cover ratio was 1.6 compared to 2.0 the last time around. These 3-year bonds are considered to be among the bonds that the European Central Bank would be willing to purchase in the secondary market.

"Overall the auctions today were taken comfortably," said Nick Stamenkovic of Ria Capital Markets, "but a sustainable decline in yields really depends on the Spanish government coming up to the plate and asking for a sovereign bailout."

Mixed fortunes on the high street

Online grocer Ocado is on offer after an underwhelming trading update. The firm said gross sales increased 9.9% in the 12 weeks to August 5th 2012 and that it expects an increase in the rate of sale growth in the fourth quarter.

Year to date gross sales growth to the end of the third quarter was 11.3%. Panmure Gordon, which is bearish on the stock, had been looking for third quarter sales growth of 13%.

Capital Shopping Centres (CSC) is to tap the bond market to refinance its short-term borrowings and top up its war-chest. The shares dived after the group said it is offering £300m of senior unsecured convertible bonds due 2018, although, depending on demand, the size of the issue may increase to £350m.

Food and drink wholesale group Booker Group has reported a 4.3% year-on-year rise in total sales in the 12 weeks to September 14th, with non-tobacco sales 3.9% higher, while tobacco sales rose by 5.1%.

On a like-for-like (LFL) basis, total sales rose by 4.4%, non-tobacco sales by 3.8% and tobacco sales by 5.4%. Peel Hunt had forecast LFL non-tobacco sales growth of 4.0%, which might account for why the shares lost a little ground in the morning session.

In contrast, supermarkets Morrisons and Sainsbury are wanted after this morning's retail sales data.

Miners mashed

The Chinese PMI manufacturing data has hit metals prices and prompted a sell-off of mining stocks. BHP Billiton, meanwhile, has confirmed it is to cease studies into the expansion of its Red Hill coal asset in central Queensland. The decision should not come as too great a surprise as the group announced on August 22nd that it would delay a number of project expansions because of current market conditions.

In other company news, Imperial Tobacco Group has said that the overall financial position and operational performance of the group in the year ended September 30th has been in line with its expectations. Tobacco net revenues are expected to be up by around four per cent with particularly good performances in its Eastern Europe, Africa & Middle East and Asia-Pacific regions. However, stick equivalent volumes are expected to decline by up to three per cent, the majority of which is due to ongoing market weakness in Ukraine and Poland and compliance with international trade sanctions against Syria.

BSkyB has said it welcomes an announcement by Ofcom that Sky "remains a fit and proper holder of its broadcasting licences".

Utility company United Utilities remains confident of delivering its 2010-15 regulatory out-performance targets after a solid start to the current financial year. Revenue in the year to the end of March 2013 should be higher than last year, but, as expected, the increase is slightly below the allowed regulated price rise, principally reflecting the ongoing impact of customers switching to meters and continued lower commercial volumes.


FTSE 100 - Risers
ITV (ITV) 91.40p +2.12%
International Consolidated Airlines Group SA (CDI) (IAG) 157.80p +1.68%
Imperial Tobacco Group (IMT) 2,361.00p +1.07%
British Sky Broadcasting Group (BSY) 733.00p +0.83%
Rolls-Royce Holdings (RR.) 864.00p +0.64%
Vodafone Group (VOD) 175.55p +0.63%
Centrica (CNA) 337.40p +0.57%
Morrison (Wm) Supermarkets (MRW) 294.60p +0.48%
Sainsbury (J) (SBRY) 342.80p +0.44%
Amec (AMEC) 1,136.00p +0.44%

FTSE 100 - Fallers
Evraz (EVR) 266.10p -4.11%
Anglo American (AAL) 1,957.50p -3.76%
Vedanta Resources (VED) 1,042.00p -3.52%
Capital Shopping Centres Group (CSCG) 335.70p -3.14%
Kazakhmys (KAZ) 728.00p -2.93%
Antofagasta (ANTO) 1,251.00p -2.87%
BHP Billiton (BLT) 1,944.00p -2.80%
Rio Tinto (RIO) 3,079.50p -2.59%
Eurasian Natural Resources Corp. (ENRC) 348.40p -2.52%
Fresnillo (FRES) 1,824.00p -2.36%

FTSE 250 - Risers
easyJet (EZJ) 586.50p +2.36%
Bwin.party Digital Entertainment (BPTY) 112.50p +2.27%
Anite (AIE) 128.90p +2.14%
Petra Diamonds Ltd.(DI) (PDL) 104.60p +2.05%
Halma (HLMA) 443.40p +1.93%
NMC Health (NMC) 196.40p +1.76%
Drax Group (DRX) 512.50p +1.69%
Ladbrokes (LAD) 184.80p +1.54%
TalkTalk Telecom Group (TALK) 187.50p +1.46%
Cable & Wireless Communications (CWC) 37.64p +1.46%

FTSE 250 - Fallers
Bumi (BUMI) 264.90p -6.06%
Lonmin (LMI) 621.00p -4.68%
New World Resources A Shares (NWR) 295.20p -4.47%
Chemring Group (CHG) 345.70p -4.13%
Aquarius Platinum Ltd. (AQP) 44.92p -3.91%
Ruspetro (RPO) 103.10p -3.64%
Ferrexpo (FXPO) 211.50p -3.12%
Bank of Georgia Holdings (BGEO) 1,290.00p -3.01%
Hunting (HTG) 850.00p -2.63%
Bodycote (BOY) 394.60p -2.52%

FTSE TechMARK - Risers
Timeweave (TMW) 23.00p +3.37%
Xaar (XAR) 240.00p +2.13%
Filtronic (FTC) 43.50p +2.05%

FTSE TechMARK - Fallers
Promethean World (PRW) 23.00p -4.17%
Oxford Biomedica (OXB) 2.40p -4.00%
XP Power Ltd. (DI) (XPP) 1,011.00p -3.71%
Kofax (KFX) 295.25p -2.32%


JH

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