Morning Market, Wednesday 30th April 2008

The FTSE was about even at 6,089 in its first hour of trading, maybe down a point or so.  The FTSE 250 was actually up over 40 points at 10,048.  There is still some caution in the air until everyone hears what the Feds are going to do with interest rates.

Last night over the pond it was a similar scenario. The DJI closed down nearly 39 points at 12,831.94. The Fed Res is expected to cut rates by another 25 points, or 0.25%, to try and put more confidence back in to the US economy.  We should hear about the time London closes later today.  If rates do xcome down again that quarter per cent to 2% then economists believe they will stay there for a while. All this has helped the US Dollar, which is now a bit stronger than it weas last week.  This has caused oil and metal prices to pull back a little too.

Brent crude (Jun del) has pulled back from recent record levels of above US$117 bbl and was trading at around the US$113.50 bbl in London this morning.

Back here in London, the miners took a hit due to the stronger dollar and a decent recent run. Rio was down 145p at 5,865, Vedanta down 90p to 2,260, BHP down 34p to 1,784p, Kazakhmys down 27p to 1,621 after it told of problems in its copper cathode production due to severe winter conditions, causing a fall in production, and Anto was down 4p to 779p.

UK house prices were 1.0 percent lower during April compared with a year earlier, the first year-on-year fall for 12 years, according to building society Nationwide.

Higher mortgage rates and tighter lending criteria are blamed for buyers staying away from the property market thsi month, causing the average house price to fall 1.1% from March to £178,555. Also, UK consumer confidence fell to its lowest level  for nearly 16 years during the month. It’s now quite obvious that there is a rather major economic slowdown building.

Back to stocks, where BSkyB had a decent start today, up 15p to 555p after announcing another new 56,000  customers for the 3rd quarter and added that it has seen an improvement in the number of customers leaving Sky for competitors. It also said that sales for 9 months was 10% up at £3.706 bln, but operating profit fell due to the cost of the move into broadband.

Home Retail Group, who own Argos, was up 9p at 251p after it reported an expected 15% rise in full year pre-tax profit, but added that Homebase, its home improvement business, had made a “weaker than anticipated” start to the new year.  Broker Landsbanki retained its ‘hold’ rating.

Standard Life was 2.25p higher at 250p after the Edinburgh-based insurer said total sales for UK in the 1st quarter were up 8%, which was better than expected. Peer Admiral Group also had a good start, up 30p to 851p after a Broker Citigroup upgrade to ‘buy’ from ‘hold’.

BG Group didn’t do so well, down 35p to 1,273p despite telling us of its 76% rise in net profit for Q1. Other related news may have affected the price as it was made known that BG made a £6 bln takeover bid overnight for Australia’s Origin Energy Ltd.

Game Group was up another 7p to 271p after rumours of a bid form Texas-based Gamestop.

Partygaming was a penny down at 25p after reporting a 21% rise in 1st quarter revenues and added that it was confident about its prospects for 2008.

Bodycote International was up 30p to 242p after an upbeat trading statement, in which it it said it may sell its testing unit.