RAMSEY CROOKALL

22nd   September 2011

Morning Report

The FTSE 100 has slumped 3.7%, extending Thursday's losses as investors express disappointment with the Fed's downbeat assessment of the US economy and its latest attempt to boost it. Investors have found “Operation Twist” underwhelming and raised questions about how effective the measure can be. Adding to economic worries, PMI data from China and the euro zone show a contraction. The data has pushed mining and oil equities down.

Resource stocks were providing the biggest downward pressure for markets, tracking lower commodity prices. BP PLC gave up 3.6% and Royal Dutch Shell tumbled 2%.

In addition to oil majors, heavyweight mining stocks such as Rio Tinto PLC slid 5.8% and BHP Billiton PLC fell 4.7%.

United Utilities has confirmed it is on track to deliver its out-performance targets. First half revenue came in higher than last year, though operating expenses are also on the up. The group said it intends to accelerate some £100m of previously agreed pension deficit payments, providing a higher investment return for the group than could have been achieved through short term deposits. The shares are still lower today though. EasyJet bucks the trend after it said the increase in total revenue per seat at constant currency for the second half of the year is expected to be towards the upper end of its expectations at around 6%, which means full year growth will be around 3%. Full year profit before tac is now expected to be between £240m and £250m.

Tim Breedon, Group Chief Executive of Legal & General has advised them of his intention to retire from the company at the end of 2012. The insurance giant will announce a successor in due course.

THE FTSE 100 at 10:00                      Down        193     @      5094

THE DOW JONES closed                       Down       283      @      11124                      NASDAQ COM closed                          Down         50     @      2538               Commodities Spot Gold $/Oz           $1766 Brent Crude Oil          $108.26 September Delivery   

Exchange Rates GBP – USD           1.5445 GBP - EURO         1.1424