1630 Close: The FTSE 100 closed down 65.26 points to 6,777.85 amid the turmoil in Iraq and the prospect of a UK interest rate hike. UK building stocks declined on concerns over a potential cooling of the British housing market after Bank of England (BoE) Governor Mark Carney warned that interest rates could rise within six months. Meanwhile, Chancellor George Osborne vowed to increase the BoE's power to curb mortgage lending in order to prevent Britons taking out mortgages that are too big in comparison to their income or the value of their home. Also weighing on stocks, the Islamic State in Iraq and the Levant (ISIL) seized several cities and headed for Baghdad. The unrest has raised concerns that it may disrupt oil supplies, pushing the price of oil higher.
1600: The UK and China are set to sign business deals worth at least $30bn next week when China's Premier Li Keqiang visit London, the Chinese ambassador to Britain said on Friday. "The total value may be record-breaking," Liu Xiaoming, China's ambassador to Britain, told a news conference in London. He said that more than 40 separate agreements whose total value was at least $30bn. would be signed. The deals will cover a range of sectors, including energy, education and finance.
1505: Front month Brent crude futures have pared their earlier gains and are now higher by just 0.247% to $113.3/barrel on the ICE.
1455: The University of Michigan´s preliminary consumer confidence index for the month of June slipped to 81.2 from 81.9 in the month before (consensus: 83).
1451: BP has entered into a repurchase mandate agreement with an independent third party relating to the $8bn share repurchase programme unveiled in March.
1330: US producer prices slipped by 0.2% over the month in May, according to the Bureau of Labor Statistics, and advanced at a 2% year-on-year clip. Excluding the most volatile components of energy, food and trade prices were flat. The consensus estimate had been for an increase of 0.1% month-on-month.
1304: Before Governor Carney´s speech last night over half the 29 financial institutions surveyed by Bloomberg were forecasting a first increase in Bank rate by March. Forward contracts based on the sterling overnight interbank average, or Sonia, on the other hand, were pegging the most likely date for a first 25 basis point rise in interest rates in May. Investors now expect the first move to come in February, the news agency reported.
1206: The FTSE 100 is down 83 points at 6,760, on track to finish at its worst level since April 28th (close: 6,700.16) on the back of a sell-off in the housing sector. Persimmon, Barratt Developments, Taylor Wimpey, Bovis Homes and Berkeley are among the worst performers on the FTSE 350 this morning due to the increased possibility of a rate hike before the end of the year.
1047: Both The Times´s Tempus and The Daily Telegraph´s Questor column are highlighting the positive implications of recent events in Iraq for Genel Energy, as Baghdad´s hand in the north is weakened.
1000: The Eurozone´s trade balance slipped to €15.7bn in April form €16.7bn in the month before (consensus: €16.3bn).
0930: UK construction grew by 1.2% month-on-month in April (consensus: 1.5%). The previous month´s gain has been revised to show a decrease of just 0.2% over the month versus -1% beforehand.
0845: Stocks in the UK have begun the morning on their back foot following an overnight spill on Wall Street, as traders focus on developing events in Iraq. Front month Brent crude futures are now rising 1.37% to $114.59/barrel on the ICE. Cable also moved a couple of notches higher overnight after the Governor of the Bank of England said that rates could rise sooner than markets expected. Cable is now at 1.6986. Data overnight from China was in line or slightly ahead of expectations, but to little avail. Cyclical stocks such IAG, easyJet and Barrat Developments are doing worst in the early going. FTSE 100 down 31 to 6,812.