Market Comments

In mid-morning trading the FTSE 100 is up 23 points at 6205, as the mining sector has made a sudden swing to positive territory.

The London market continues to be pulled in both directions by natural resources stocks as crippling oil prices and crumbling manufacturing figures out of China have ensured choppy trading. You can run but you can’t hide is what the Russian central bank found out when it raised rates to 17%, but this erratic move still wasn’t enough to stop the rouble from returning to its losing streak. British banks are clutching on to fractional gains after the Bank of England stress test results were released this morning. Lloyds and RBS passed by the skin of their teeth; both bailed-out banks beat the capital requirements by the narrowest of margins. Traders were hoping that Lloyds would restart paying dividends next year, but today’s revelations suggest the banks needs all the cash in its coffers. 2015 will be an important year for RBS and Lloyds as a change of government is on the cards, and the shareholding in the financial institutions is looking less likely to be reduced any time soon given the state of the respective capital structures. Shares in BT Group are back above £4 as the company has taken one step closer to becoming Britain’s largest one stop shop for phone line, broadband, TV and mobile services. BT is targeting EE for £12.5 billion in the hope it will corner the so-called quad-play market, and if the deal goes ahead we can expect a big shake up in the telecoms sector as BT is tipped to succeed where Virgin Media has failed.

In the US we are calling the Dow up 35 points at 17,215, as problems in Moscow seem a million miles away from Wall Street. Traders' attention is squarely on the Federal Reserve’s meeting tomorrow, and if the US central bank wasn’t already concerned about global growth the rumblings out of Russia and China today could results in dovish language.