FTSE up but GDP data casts shadow

Investors were apparently gaining in confidence that the US would break its deadlock over a debt deal as the FTSE 100 opened on the front foot today.

The US is under pressure to rescue its Triple A credit rating by upping its debt ceiling - a controversial move which has driven a wedge between Republicans and Democrats.

Meanwhile investors were also eyeing official UK GDP figures which showed that growth was stalling and so raising fears that the economic recovery was hitting the buffers.

Gross Domestic Product (GDP) grew by 0.2 per cent in the second quarter, according to the Office for National Statistics. That compares with 0.5 per cent in the previous quarter.

But in early trading the market showed resilience.

Oil and gas company BG was the highest riser, up 2.5 per cent after reporting a 27 per cent jump in profit.

The mining sector was boosted by climbing metal prices, particularly copper.

Anglo American was up 1.6 per cent with Xstrata also up around the same level.

Rio Tinto nudged up 0.75 per cent and BHP Billiton 0.3 per cent.

Other climbers included engineer Weir Group which put on 1.5 per cent while United Utilities edged up by a similar level.

iPhone chip maker Arm Holdings also gained up after reporting a profit jump fuelled by a rise in sales of smartphones.

Among banks Lloyds dipped by 0.2 per cent, while HSBC and RBS saw narrow gains. Barclays rose 0.2 per cent, in a mixed picture for the banking sector after the stocks took a buffeting yesterday.

BP was the biggest faller on the blue chip index, down 2.5 per cent. The drop came as the oil company reported a £3.2bn profit in the latest quarter — a figure which underwhelmed investors.

BSkyB was the second biggest faller as Rupert Murdoch's failed bid for the company continued to cast a shadow.

Imperial Tobacco was down 0.8 per cent after it said its sales had been hit by a price war in Spain.

Retailer Burberry, more accustomed to being one of the highest climbers on the FTSE 100, was down 1.5 per cent.

In the US July consumer credit and June new home sales numbers are due for release later.