Markets lose ground ahead of US GDP announcement

Investors are steeling themselves for disappointment from this afternoon's release of US economic growth figures for the second quarter.

Shares are mostly lower in opening deals as investors wait nervously for US GDP data later.

The FTSE 100 was down 19 points  at 5,295 and the mid-cap FTSE 250 was down 29 points at 10,044.

Overnight the Dow Jones Industrial Average fell 31 points to 10,467 with disappointing earnings news weighing. Focus today will be on the first reading of second quarter GDP after this week's durable goods orders and other economic data pointed to a slowdown in the recovery in the world's largest economy.

Michael Hewson at CMC Markets said: 'Given the recent propensity for US economic data to disappoint there is the possibility that Friday’s figure could well fall short of the consensus forecast of 2.5%. If that were to happen it could well stop this equity rally in its tracks.'

In Asia, markets were weighed down by a surprise drop in Japan’s industrial production and a larger-than-expected rise in unemployment. The Nikkei fell 159 points to 9,537.

 
Back in the UK, British Airways topped the FTSE 100 riser board, up 6.2p at 222.2p after the flag carrier reported a much smaller than forecast operating loss in the first quarter  thanks to better revenues and higher passenger yields. 

Selected banks are higher ahead of earnings reports in the sector due next week, with Lloyds leading the pack. Shares in the 415 state-owned bank were up 0.29p at 69.2p.

Miners and oil groups led the fallers amid growing fears about the outlook for the global economy. Essar Energy fell 8.8p to 420p and Xstrata was down 17p at £10.15

On-line retailer Ocado is in the spotlight again after statements to the stock exchange show that existing shareholders took around half of the group's IPO allocation and fund management firm Fidelity increased its holding to just shy of 30%.

In the run up to its IPO a number of analysts questioned the outlook for the business and the group was forced to slash its offer price to 180p. Today shares are up 0.25p at 165.87p.