1630: The Footsie ended the week higher following upbeat UK economic data including gross domestic product (GDP) figures and a mortgage approvals report.
The Office for National Statistics (ONS) said GDP for the second quarter was revised upwards to 0.7 per cent. GDP was up 0.1 per cent from the initial estimate released in July. Compared to a year ago, it was 1.4 per cent higher. The ONS said the revision reflected growth across agriculture, construction, production and services.
Separately the British Bankers' Association (BBA) revealed mortgage approvals for house purchases grew 31 per cent to 37,200 in July compared to a year earlier. The BBA said government schemes such as Funding for Lending and Help to Buy combined with record low interest rates boosted demand in the sector. FTSE 100 finished up 45.23 to 6,492.10.
1600: Regarding reports that Investec has modified its call on further QE today Victoria Clarke has clarified to Sharecast that this in fact occurred roughly one week ago. Concerning UK unemployment, they estimate that it will fall towards 7 per cent at about the back-end of 2015, a view shared by a few others in the City. However, she does point out how their view on GDP is quite similar to the MPC's. Again, it would seem that it all boils down to the so-called "productivity puzzle."
1550:Euro-area confidence rose more than expected in August, the European Commission said. An index of household confidence in the Eurozone improved for a ninth month to minus 15.6, the highest level since July 2011, from minus 17.4 in the previous month. Economists had predicted an increase to minus 16.5. It signalled a further upswing in the 17-nation currency bloc as it recovers after a record-long recession.
1543: Commenting on today's housing data Stateside Barclays Research is telling clients that: "Altogether, the softness in this report is likely to raise fears about whether the recovery in US housing will prove durable to the rise in mortgage rates observed since early May. Our view has been that the recovery in housing may slow due to the sizeable fiscal drag in place during 2013 and higher mortgage rates, but that housing fundamentals were strong enough to prevent a sharp correction in activity. We continue to hold this view [...]."
1541: In their weekly global economic overview economists at Investec point out that their forecast is for unemployment in the UK to fall faster than the Monetary Policy Committee [MPC] envisages. Nevertheless, they add that: "[...] but if the relative steepness of the curve persists, the MPC could be tempted to restart quantitative easing [QE], with tangible downside for the pound."
1500: New US home sales plummeted to an annualised rate of 394,000 in July (Consensus: 490,000). In parallel, the European Commission's gauge of Eurozone consumer confidence improved to -15.6 in August, from -17,4 in the month before (Consensus: -16.5). The latter is the best reading since July 2011. Acting as a backdrop, Fed speakers keep coming out of the wood work today. The latest is the President of the Federal Reserve bank of San Francisco - John Williams - who is out saying that tapering must be data-dependent. He is the third American central banker to have shared his thoughts with the markets today.
1451: Looking out to mid-2014 Barclays Research has raised its forecast for the 10 year US treasury yield to 3.5 per cent from 2.9 per cent. FTSE 100 up 49 to 6,496.
1433: Proxama shares
are now down by 7 per cent in their first day of trading after reversing into a so-called 'cash shell,' yet that follows an over 300 per cent rise since the start of May in anticipation of the transaction. Other electronic wallet technology companies such as Monitise have also had a strong rise of late, having gained approximately 50 per cent over the last year or so.
1314: Investec reportedly no longer sees the Bank of England carrying out 75bn pounds in additional quantitative easing, it had previously forecast the monetary authority to purchase a further 75bn pounds in debt.
1305: The President of the Federal Reserve bank of Atlanta, Dennis Lockhart, is out saying that he would favour a September start to tapering if the data is sufficiently strong.
1145: Top-tier investment bank Goldman Sachs has today slashed its price forecasts for the Indonesian rupiah, the Malaysian ringgit and the Thai baht on a three, six and twelve month basis. The former is expected to do worst as investors flee the group for the safety of developed markets. The Indonesian currency unit is now called to drop by another 9 per cent to 11.8 in its cross versus the US dollar. FTSE 100 up 14 to 6,460.
1038: Speaking on the sides of the Jackson Hole symposium European Central Bank Governing Council Member Ewald Nowotny said the recent "stream of good news" from the euro-area economy has removed any need to cut interest rates to a fresh record low, Bloomberg TV reports.
1030: UK 10 year Gilt yields are now edging higher by 1.0 basis point to the 2.72 per cent mark. FTSE 100 up 13 to 6,459. Commenting on this morning's economic activity figures in the UK, Capital Economics had this to say: "[...] So the recovery seems to be becoming more balanced - which is just as well, given that the consumer-driven growth seen previously was largely based on households running down their saving. Looking ahead, the economy still faces some serious constraints (the fiscal squeeze, weak bank lending), so it may struggle to keep growing at quite such robust rates."
0930: Gross domestic product in the UK expanded at a 0.7 per cent quarter-on-quarter clip in the second quarter, one-tenth of a percentage point better than expected, according to ONS. Construction output was revised notably higher, to show growth of 1.4 per cent.
0915: A detailed breakdown of German second quarter growth showed on Friday that the solid recovery was driven by corporate fixed investment and strong consumption. The German statistics office Destatis said the 0.7 per cent expansion in second quarter gross domestic product that was published last week was supported by a pick-up in consumption and a rebound in investment helped stimulate recovery. Capital investment jumped 1.9 per cent from the three months through March, the first expansion in three quarters, and consumption increased 0.5 per cent.
0840: Stocks are giving back a little bit of yesterday´s advance. Croda and Carnival are in the lead early on. At 09:30 the Office for National Statistics [ONS] will publish the second estimate of second quarter gross domestic product [GDP], which will include the expenditure breakdown (Consensus: 0.6% quarter-on-quarter). Germany´s second quarter expansion has been confirmed at 0.7 per cent quarter-on-quarter, as expected. FTSE 100 down 16 to 6,431.