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For the second day in a row the mining sector is dragging the index lower, as softer commodity prices and poor results for BHP Billiton and Glencore Xstrata hammer home that the mining boom is over. The newly-formed mega miner Glencore Xstrata revealed a slight slip in revenues but large write-downs worried investors. BHP Billiton is in the same boat, with the world’s largest miner undergoing a cost-cutting programme but it isn’t enough to offset falling metal prices.
The government’s ‘Help to Buy’ scheme is certainly helping homebuilders. Persimmon this morning announced a 38% jump in first-half profit, just a day after Bovis Homes also revealed a strong set of results.
Across the pond, we are expecting the Dow Jones to open broadly unchanged at 15,010, as traders sit on their hands ahead of the FOMC meeting tomorrow.