It was no surprise, really, that Liberty International’s first-half results disappointed yesterday – Britain’s retailers and property companies have taken a severe kicking during the economic downturn – but did it really need to be quite so gloomy? Well, yes. Here was a story of bad news, more bad news and a little bit of good news, but not enough to prevent the market taking fright somewhat.

The retail-focused real estate trust (Reit) behind such shopping centres as Lakeside and Covent Garden reported a 7.4 per cent fall in the value of its portfolio, gave warning that a property market revival could not begin before the banking sector recovered and added, moreover, that property values were likely to fall still further. Patrick Burgess, the chairman, predicted that the property cycle would have to run its course with the “excesses of the boom years to be purged from the system”.

Falling values and rising bad debts from its tenants meant that Liberty slipped to a first-half pre-tax loss of £458 million, compared with a profit of £552 million last time. Shares in the company, Britain’s third-largest Reit with an £8.6 billion property portfolio, fell 70p to 900p.

And the good news? Liberty told investors that occupancy levels remained high and that footfall at its shopping centres had not fallen. It also said that it had about £478 million of cash and undrawn debt to invest.

Other property groups slipped, with Hammerson down 28p to 989p, British Land losing 21½p to 737p and Land Securities 35p lower at £13.45, but the FTSE 100 made ground for the second day in succession, rising by 31.6 points to 5,486.1, with those property losses more than offset by gains by miners. Lonmin led the blue-chip risers, up £11.07 to £34.26, after Xstrata, the Anglo-Swiss mining giant, made a £5 billion offer for the world’s third-largest primary producer of platinum. The deal was a shot in the arm for the sector, which has struggled in recent sessions. Eurasian Natural Resources climbed 67p to £10.17, Antofagasta rose 22½p to 542½p and Kazakhmys was up 45p at £13.35.

News of a military coup in Mauritania, in northwest Africa, sent shudders through some oil stocks. In the country’s second coup in three years, soldiers overthrew the elected President and announced the formation of a military-led ruling council. Tullow Oil, which holds interests in offshore Mauritania, fell 2p to 733p, although Premier Oil, which also has interests in the country, weathered the news, ending up 73p to £12.28. Other London-listed companies with interests in Mauritania include Roc Oil, down 0.01p at 1.26p, and Dana Petroleum, up 50p to £12.77.

Hunting was among the FTSE 250’s top risers, up 93½p to 886p, after it agreed to sell Gibson Energy, its Canada-based oil services business, to a private equity consortium led by Riverstone and Carlyle for up to £626 million. Hunting will book a £305 million gain from the deal and will use the funds to pay down debts, invest in Hunting Energy Services and fund acquisitions.

New York: US shares extended their gains as a further drop in the oil price and a reassuring outlook from Cisco Systems overshadowed concern about the housing slump. The Dow Jones industrial average closed up 40.30 points at 11,656.10.

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