Bit of a turnaround on the markets, after some poor US manufacturing figures. Earlier today the UK purchasing managers survey showed British manufacturing order books at their worst for nearly two years.
Now comes news from across the Atlantic that US factory activity in December fell to its lowest level since April 2003. Analysts had been looking for an index figure of 50.4, but it came in at 47.7. Anything below 50 means a contraction in the sector.
The odds seem to have shortened on a 25 basis point cut in US interest rates after these figures. Economists had already been suggesting there was a chance of a reduction in UK rates at the Bank of England's meeting next week, dependent on forthcoming surveys from the housing and services sectors.
The US figures have sent the Dow Jones Industrial Average around 120 points lower, while the FTSE 100 has come off its best levels and is now 22.8 points lower at 6434.1.
