RAMSEY CROOKALL & CO  19th March 2012

 Morning Report

The FTSE 100 was down 0.4%, remaining weak Monday, with mining and oil equities on the back foot amid falling commodity prices. Elsewhere, National Grid is down 1.6%, after having its rating cut over at Bank of America Merrill Lynch.

The big news of the morning was surrounding FTSE 250 financial software developer Misys, which has recommended to it shareholders a 350p-a-share cash offer by Magic Bidco Limited, an investment vehicle indirectly owned by Vista Funds. Shares were up nearly 7% at the 352p level in the opening hour, despite the firm also revealing that revenues are down 3% in the year-to-date, affected by the "cautious approach" adopted by customers and continuing challenging conditions in financial markets. The company also withdrew its medium-term revenue and margin targets.

On the FTSE 100, telecoms peers BT and Vodafone were two of the  best performers early on. Construction giant CRH and real estate investment trust Land Securities were under the weather ahead of Wednesday's Budget. In a research note this morning, Jefferies said that potential stamp duty reforms could adversely affect commercial property.

Investors of Burberry were being scared off by reports that potential income tax and VAT increases in France could affect the demand for luxury goods. According to an article in Bloomberg last night, whoever wins next month's election - whether it be frontrunners Nicolas Sarkozy or Francois Hollande - the manufacturers of luxury goods "will be the likely losers".

InterContinental Hotels was out of favour after launching a new brand, HUALUXE, of hotels and resorts in China, which will look to tap into the growth of domestic travellers and the increase in outbound international travel by Chinese people.

House builder Berkeley was flat despite saying that it has delivered a robust trading performance in the four months to February 29th. The group said that demand for its residential property in 2012 has remained resilient, encouraging it to top up its land bank.

Northern Russia-focused oil producer Exillon Energy fell after delaying its short-term output target due to "operational difficulties". Pre-tax loss totalled $7.1m in 2011, compared to a loss of $3.7m the year before, on revenue that surged from $84.8m to $203.0m.

THE FTSE 100 @ 10:05                             Down         23        @      5,942 THE DOW JONES closed                             Down         20         @    13,232 THE NASDAQ closed                                Down         1          @      3055 Exchange Rates

GBP – USD       @      10:05             1.5839 GBP - EURO     @      10:05             1.2032

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