RAMSEY CROOKALL

29th   July

Afternoon Report

The FTSE 100 is down 0.9%, with risk aversion enveloping the market due to worry that talks on lifting the US debt ceiling are not making progress. In stocks, bank stocks decline on the debt fears with Barclays down 2.5% and Lloyds Banking Group down 3.4%. Attention turns to the first release of 2Q US GDP due at 12:30.

Banks such as Lloyds and miners such as BHP Billiton are in negative territory.

Financial Times and Penguin books publisher Pearson moves ahead after it upgraded its outlook for the full year following interim results that saw adjusted operating profit rise by 17% year-to-year to £208m on the back of a 3% increase in the headline sales figure to £2.4bn. The interim dividend has been hiked by 8% to 14.0p from 13.0p.

BSkyB is wanted demonstrating why Rupert Murdoch’s News Corporation was so keen to get his hands on the broadcaster with a sharp rise in revenues and profits. Revenue in the year to 30 June soared to £6.6bn from £5.7bn the previous year, while EBITDA (earnings before interest, depreciation and amortisation) came in at £1.4bn, up from £1.2bn.

Mobile phone network colossus Vodafone, another riser today, is to pay a special dividend of 4p per share next year after its 45% owned US associate, Verizon Wireless, resumed dividend payments.

British Airways operator International Consolidated Airlines (IAG) also rose in early trading. It moved into profit in the second quarter, but economic weakness in some markets and high oil prices remain a concern.

Emergency home repairs outfit Homeserve expects customer growth of around 3% in the UK in the current financial year. "We have made a good start to the financial year and continue to expect to deliver another year of strong growth," the company said, adding that the results will, as usual, be second-half weighted.

THE FTSE 100 at 12:00              Down                 52          @       5820

THE DOW JONES closed               Down                 62          @       12240 

NASDAQ COMP closed                 Up                    1          @        2766                                  Exchange Rates

GBP – USD           1.6276 GBP - EURO         1.1426

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