London midday: Investors in holding pattern despite record fiscal surplus

Stocks are trading on a mixed note despite positive news on the state of the US-China trade talks, even as investors continue to closely monitor the headlines around the ongoing Brexit negotiations in Brussels.

At noon, the FTSE 100 remained down by 0.58% or 41.82 points to 7,186.80, although the second-tier index was better behaved, adding 0.05% or 10.02 points and trading at 19,217.66.

Weighing on the top flight index, trading in the pound appeared to have a generally positive bias as the Chancellor talked up the prospects for a deal and the leader of the House of Commons, Andrea Leadsom, said the government was still planning to go ahead with a vote in Parliament on either a new Brexit deal or on what the way ahead should be.

Earlier, the Chancellor had told the BBC that there wee positive signs coming out of Brussels with the European Union now promising "guarantees" that the Irish backstop would not be permanent.

In the background meanwhile, citing a person briefed on the talks, Bloomberg reported overnight that Washington and Beijing were working on various memorandums of understanding, covering areas ranging from agriculture or technology transfers and intellectual property to non-tariff barriers.

On the back of that, futures for the Dow Jones Industrials were adding 18.0 points to 25,982.0 and those for the S&P 500 0.75 points to 2,787.75.

Back in the UK, ONS reported a record public sector surplus for January of £14.9bn (consensus: £10.0bn).

According to Samuel Tombs, Pantheon Macroeconomics's chief UK economist, the data suggested that it was unlikely the economy had lost much momentum as many surveys implied.

It also implied the Chancellor would be able to set fiscal policy such that it would deliver another "modest" boost in 2020, although "with the economic outlook highly uncertain at present, next month’s Spring Statement probably will be a holding operation."

Still on the economic calendar for later in the day, Stateside, senior US and Chinese officials were due to meet again on Thursday and Friday, but this time in Washington D.C., following the prior week's contacts between the two sides.

And readings were due out on durable goods orders for the month of December, alongside the Philly Fed's regional manufacturing index for February, both at 1330 GMT.

Barclays beats analysts estimates

Barclays beat analysts' profit estimates despite the hit to the lender's operations from Brexit-related uncertainty and volatility in markets. For the fourth quarter of 2018, the lender posted a 1% increase in profits before tax to reach £574m (consensus: £566m) on the back of a 2% rise in adjusted total income to £5.1bn.

Anglo American on Thursday reported a 4% rise in underlying EBITDA to $9.2bn driven by strong prices, particularly platinum group metals, thermal and metallurgical coal and nickel, as well as productivity improvements and cost control. The company said hit took a $600m hit from the suspension of operations at it giant Minas Rio iron ore mine in Brazil. Production is due to resume by the end of the year.

Defence contractor BAE Systems said full year operating profit rose 14.3% per cent to £1.6bn as it warned that Germany's move to halt arms exports to Saudi Arabia could hit its ability to supply the controversial country in the aftermath of the murder of Saudi journalist Jamal Kashoggi. BAE said it was working closely with the UK government to "minimise the risk of any such occurrence and the impact it would have on financial performance, the supply chain and relationships".

Energy supplier Centrica on Thursday said the government-imposed price cap would hit 2019 results as it lost customers but reported a rise in operating profits. The company also announced it would sell its North American franchisee home services business Clockwork for £230m as recovery in the region was slower than expected, adding that it was targeting £500m in non-core divestments.

Standard Chartered said it was setting aside $900m (£688m) to cover fines resulting from regulatory investigations in the US and UK. According to the lender, the provision related to the potential resolution of US investigations into alleged violations of sanctions, and for probes relating to foreign exchange trading in Britain.

Kaz Minerals on Thursday reported a rise in annual profit after a revenue increase was driven by increased copper production from the FTSE 250 listed company's portfolio of low-cost open-pit mines. For the year ended 31 December the Kazakhstan-focused miner saw profit before tax increase to £0.64bn, a rise of 10.7% since the year before, after revenue jumped by 30.0% to £2.16bn on the back of a 13.9% increase in copper production to 295 kt, coming in at the upper end of its guidance range of 270-300 kt..

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