1630: Close The FTSE closed significantly lower on Thursday, following comments from incoming Governor Mark Carney, who played down expectations that he will make big alterations to UK monetary policy when he takes up his new role in the summer. Leading the fallers was Burberry, which was affected by news that the Chinese government has banned television and radio advertisements for luxury and expensive gifts, saying they promote "incorrect values and create a bad social ethos". Meanwhile, Compass was a high-riser after having a good first quarter with expectations for the full year unchanged. In economic news, the BoE maintained the Bank Rate at the record-low level of 0.5 per cent and kept the asset purchase programme unchanged at 375bn pounds, as expected. Also of interest, Ireland reached an agreement with the European Central Bank to restructure the massive debts of the former Anglo Irish Bank. The FTSE closed down 67 points at 6,228.
1535: Some market commentary is attributing the fall in shares
of Burberry to reports that on Tuesday China's media watchdog, the State Administration of Radio, Film and Television, claimed encouraging viewers to spend on luxury items helped to spread "incorrect values and create a bad social ethos." FTSE 100 down 56 to 6,240.
1525: British Airways and Iberia owner IAG is among the worst performers on the FTSE 100 after it was reported that American Airlines and US Airways are close to agreeing on a merger that would create the biggest airline (in terms of revenue) in the world.
1445: In his press conference ECB President Mario Draghi has just indicated that current FX moves are not akin to what we have seen sometimes in the past. Rather, they are a result of policies aimed at re-establishing economies' equilibrium. However, he adds that should FX rates move away from what is considered by consensus to be justifiable then it might be necessary to talk about it.
1257: Shares of Thomas Cook are now rocketing higher. Analysts at Credit Suisse have raised their price target on its shares to 93p from 36p before after what they describe as a solid first quarter. They also point out that their new target is consistent with a 34 per cent discount, on a price-to-earnings basis, to TUI Travel.
1255: Draghi notes the downside risks to inflation emanating from a higher exchange rate.
1248: Ocado is leading gains on the FTSE 350, on heavy volume, after the release of its preliminary results. Its shares are now at technical resistance, towards the 114p mark. FTSE 100 down 15 to 6,280.
1245: ECB leaves rates unchanged, as expected.
1240: Vodafone is still leading gains on the Footsie after reiterating that it expects adjusted operating profits in the upper range of 11.1bn pound to 11.9bn pound for the 2013 financial year, while projecting free cash flow at the lower range of 5.3bn pounds to 5.8bn pounds. As well, the outfit's Chief Financial Officer, Andy Halford, has said that the company's free cash flow will be adequate to cover its future dividend payments.
1224: Looking at different range of 'alternatives', as part of Funding for Lending Scheme, may be something MPC looks at when he arrives, King's successor has replied.
1210: While all focus is on comments from incoming BoE Governor Mark Carney, who is due to replace Sir Mervyn King later this year, the BoE has maintained the Bank Rate at the record-low level of 0.5 per cent and kept the asset purchase programme unchanged at 375bn pounds, as expected. As regards the latter, the BoE said it would reinvest the 6.6bn pound gilt redemption due in March, offsetting what would otherwise be a passive unwinding of QE. The MPC has also stated that inflation may remain above 2 per cent target for the next two years, citing the fall in Sterling as another factor that was likely to keep inflation elevated. In parallel, Mr.Carney has clarified that he is not convinced that the risks of pursuing a nominal GDP target would be worth taking. Same objectives can be reached with lower risk, he added.
1148: Carney seems to have answered that for now flexible inflation targeting - perhaps with some adjustment - remains the superior option.
1128: Treasury Select Committee member asking Carney if empirical evidence exists regarding the effectiveness of some of the options possible for changing policy. The economist is also explaining how nominal GDP targeting can help in dealing with both negative and positive supply shocks. Critical for it to work is public understanding of its workings, according to Bank of Canada research. However, biggest pay-off from it is when an economy is exactly where UK economy is now. FTSE 100 down 2 to 6,293.
1108: Carney sees need for quick debate on framework to limit uncertainty.
1103: Central banks cannot be indifferent to FX moves Carney states.
1058: Carney believes Bank of England can improve coordination between monetary and macro-prudential policies. Interestingly, he adds that all such large institutions can and will make mistakes sometimes.
1048: The bar for changing the policy framework must be very high, Carney has said.
1039: In his first remarks before the Treasury Select Committee Mark Carney has stated he has no political ambitions. He is also being asked at length regarding his views on the possible negative effects arising from income inequalities. Whereas he seems to prefer a team approach to thinking he is aware that consensus may not always be possible. His job is to ensure that all views will be heard.
1009: The Spanish Treasury has sold 4.6bn euros in medium and long-term debt, slightly ahead of the 4.5bn euros that was targeted. The yields on offer, however, did increase versus the last time around. That is weighing a little on the secondary market. FTSE 100 up 12 to 6,307.
0930: Industrial production rose by 1.1 per cent month-on-month in December (Consensus: 0.9 per cent). Manufacturing production increased by 1.6 per cent, twice expectations. In other figures out this morning, the so-called 'visible' trade deficit improved slightly versus last month, to stand at 8.9bn pounds (Previous: 9.2bn; Consensus: 8.9bn). The total trade deficit decreased to 3.2bn pounds, versus 3.6bn the last time around.
0830: The Footsie has begun the day ever so slightly higher on the back of positive news on the earnings front for Vodafone and TUI. Balance of trade and industrial production data are slated for release at 09:30, the Bank of England's interest rate decision for 12:00 and - above all - Bank of England Governor-in-waiting Mark Carney's testimony before the Treasury Select Committee at 09:45. To watch out for, the Spanish Treasury will tap bond markets at about the same time as Mr. Carney hits the microphones. The European Central Bank's own policy meeting, later today, could also move markets. FTSE 100 up 7 to 6,303.