News

The number of Footsie constituents showing gains on the day is in single figures as London follows Wall Street lower. Unemployment figures have added to the gloom as the claims for jobless benefits in September rose 31,800 to 939,900, the highest level since November 2006.

Miners lead the market lower on worries about demand for metals if the world economy does slow as much as predicted. Kazakhmys, Vedanta and Xstrata lead the fallers. The turmoil in global markets has caused miner and bid target Rio Tinto to reconsider the timeline of the first wave of its proposed sale of assets. The company also warned that the Chinese economy is “pausing for breath” and growth in the Chinese economy this year is expected to below 10%, down from almost 12% last year.

Lloyds TSB is bucking the trend on talk the government may have to allow it to set its own dividends or risk the merger deal with HBOS unwinding. Royal Bank of Scotland is also higher on talk that it too will want a similar dividend concession if Lloyds gets it.

Autonomy's bumper profits have seen it move forward along with Pearson. As it forecast recently, data search software giant Autonomy's third quarter figures came in right at the top of forecasts. Profit before tax jumped 160% to $47.9m from $18.3m on revenues up 42% at $127.1m, driven by strong organic growth.

Publishing group Pearson is receiving a boost to profits from the resurgent US dollar. The group said that if the recent strengthening of the greenback versus sterling is maintained, full-year adjusted earnings per share are likely to be at the top end of current market estimates. The group said it is currently trading in line with expectations. Sector peer Reed Elsevier rises in sympathy.

Elsewhere, strong demand for armoured cars is keeping weapons group BAE Systems on track this year. "Anticipated growth outlook for 2008 is benefiting from the high demand for armoured wheeled vehicles in the group's land & armaments business. The group anticipates a return to operating cash inflow in the second half year," it said in a statement.

Growth accelerated during the second quarter at credit checking firm Experian, lifting revenues for the half year by 13%, with organic growth of 3% helped by 5% growth in the second three month period. “We remain vigilant on costs and are focused on driving profit growth,” said chief executive Don Robert.

A resilient performance at Marston's leaves the pub group predicting earnings before exceptional items for the year to 4 October will be in line with expectations after benefiting from a slightly reduced tax charge. Like-for-like sales at the managed pub division were 0.6% below last year, while the tenanted and leased pub division saw like-for-like profit drop 1.7% below 2007, including a fall of around 3% in the second.

Among the small caps, betting shop software group Alphameric, says trading conditions in its bookmaking display and systems business have tightened in recent weeks and that the division is currently trading behind management's expectations.

Inkjet printing technology group Xaar is laid low by a profit warning. The group said lower sales in China will reduce third quarter revenues and profits.