London mid-morning: Downward drift continues

Footsie has continued drifting downward after a weak start as company updates fail to impress the market.

Shares in Next are sharply lower. The fashion retailer has noticed a 'cooling' in consumers' demand in recent months, but still expects profits this year to rise by between 6-11%, in line with its previous forecasts. 'We believe that consumer spending will be more restrained in the second half than in the first, as spending cuts and tax rises begin to take effect,' the high street giant said.

Standard Chartered is lower too. This is despite sharply lower impairment provisions were at the Asia-focused bank in the first half of 2010 as pre-tax profit improved 10% year on year. Profit before taxation of $3,116m was up 10% from $2,838m in the corresponding period of 2009.

In the FTSE 250, shares in Salamander Energy have taken a big knock. The oil explorer has been hit with a double dose of bad news as it's had to restate reserves for the Kambuna field, offshore North Sumatra Indonesia, while a well in Lao PDR turned up dry.

Back in the top flight, Lloyds is slightly higher. The bank is very much back in the black after posting a profit of £1.6bn for the first half of 2010, twice as much as some analysts had forecast. The bank, which lost almost £4bn this time last year and is still 41%-owned by the government, added that total impairments more than halved to £6.55bn from £13.4bn a year ago.

Insurance giant Legal & General (L&G) topped market expectations with its interim figures and has rewarded shareholders with a 20% hike in the dividend. European Embedded Value (EEV) operating profit in the first half of 2010 was £589m, down from £656m the year before but ahead of most broker forecasts.

Santander's UK arm has confirmed the acquisition of more than 300 branches from Royal Bank of Scotland for £1.65bn, slightly less than expected. The deal will catapult Santander UK into the number two slot in UK retail banking. It already owns Abbey, Alliance & Leicester and Bradford & Bingley. Today's acquisition will see it take over 311 RBS branches in England and Wales and seven NatWest branches in Scotland.

It's looking like BP may have sealed the leaking Maconda well in the Gulf of Mexico by pumping it full of mud from vessels on the surface - a process known as "static kill". The procedure started at 9pm UK time on Tuesday and continued for the next eight hours. The well now "appears to have reached a static condition", BP said this morning.

Sales fell at Carpetright during the first quarter, forcing the carpet and flooring retailer to take another close look at costs and spending. Like for like sales in the UK and Ireland dropped 3.4% in the 13 weeks ended 31 July compared with a 1.4% increase this time last year. The decline accelerated to 4.2% in the rest of Europe from 3.1% last time.

Engineer and ceramics group Cookson moved back into the black in the first half of the year and said it expects second half profit to exceed the first half. For the half year ended June 30 Cookson posted a pre-tax profit of £92.5m compared to a loss of £89.7m the year before. Revenue increased to £1.23bn from £929m previously.

Premier Foods warned that a surge in wheat prices in the past month means second half profit at its Hovis division is unlikely to match levels seen in 2009. 'With the competitive marketplace and rising wheat costs, which have in recent weeks begun to escalate, it is unlikely that the division's second half profit will match its 2009 profit level as this period last year particularly benefited from wheat price deflation,' the group said in a statement.

FTSE 100 - Risers
African Barrick Gold (ABG) 553.50p +1.93%
Lloyds Banking Group (LLOY) 73.09p +1.63%
Shire Plc (SHP) 1,487.00p +0.95%
InterContinental Hotels Group (IHG) 1,131.00p +0.89%
United Utilities Group (UU.) 595.50p +0.42%
Hammerson (HMSO) 390.50p +0.28%
British Sky Broadcasting Group (BSY) 713.00p +0.28%
Pearson (PSON) 1,005.00p +0.20%
ARM Holdings (ARM) 312.40p +0.10%
Man Group (EMG) 227.80p +0.09%

FTSE 100 - Fallers
Next (NXT) 2,030.00p -7.69%
Standard Chartered (STAN) 1,777.00p -6.60%
Home Retail Group (HOME) 235.10p -3.84%
Antofagasta (ANTO) 1,000.00p -3.57%
Reckitt Benckiser Group (RB.) 3,111.00p -3.39%
Marks & Spencer Group (MKS) 348.50p -3.36%
Kingfisher (KGF) 216.70p -3.17%
British Land Co (BLND) 455.60p -2.96%
Legal & General Group (LGEN) 88.25p -2.81%
Aviva (AV.) 366.60p -2.63%

FTSE 250 - Risers
Premier Foods (PFD) 19.08p +6.00%
BlueBay Asset Management (BBAY) 269.60p +2.82%
Paragon Group Of Companies (PAG) 142.00p +1.72%
JPMorgan Indian Inv Trust (JII) 403.20p +1.66%
Homeserve (HSV) 456.40p +1.65%
Promethean World (PRW) 130.00p +1.48%
Keller Group (KLR) 590.00p +1.37%
JPMorgan Asian Inv Trust (JAI) 201.00p +1.31%
TR Property Inv Trust (TRY) 151.00p +1.27%
Britvic (BVIC) 479.10p +1.01%

FTSE 250 - Fallers
Salamander Energy (SMDR) 224.00p -10.40%
Cookson Group (CKSN) 444.30p -7.17%
Connaught (CNT) 31.20p -6.47%
Game Group (GMG) 67.75p -5.57%
Debenhams (DEB) 62.85p -4.27%
Inchcape (INCH) 296.60p -3.83%
Daejan Holdings (DJAN) 2,259.00p -3.83%
DSG International (DSGI) 26.53p -3.74%
Taylor Wimpey (TW.) 30.13p -3.12%
Intermediate Capital Group (ICP) 261.50p -3.08%