RAMSEY CROOKALL

28th   July

Morning Report

The FTSE 100 is down slightly and maintaining small losses. The index is off the earlier lows of 5801.58. This is largely following decent corporate earnings data. BAE Systems is the biggest gainer, up 5.1% followed by BT Group up 2.7%, following well-received results. In addition to this, banks bounce following their slide yesterday. Lloyds Banking Group is up 1.6% and Barclays is up 1.4%. Meanwhile, US stock futures are also ticking higher, with Wall Street likely to bounce following Wednesday's sharp declines.

Anglo-Dutch integrated oil company Royal Dutch Shell fell lower after it reported net income on a current cost of supplies (CCS) basis, excluding specific items, of $6.6bn, compared to $4.2bn in the second quarter of last year. The figure was in line with market estimates.

Drugs giant AstraZeneca rose after despite seeing second quarter profit before tax slide 2%, or 4% on a constant exchange rates (CER) basis, to $2.86bn from $2.92bn the year before. Revenue rose 3% (but fell 2% on a CER basis) to $8.43bn from $8.18bn.

Rolls-Royce edged higher after it revealed record orders in the first half while profits jumped 28% to beat expectations, enabling the aerospace, power systems and defense group to up its payout to shareholders.

HSBC fell lower following speculation that it could soon announce more than 10,000 job cuts, according to insiders at the bank cited by Sky News, with some of those redundancies coming from the head office. The above as part of the bank’s efforts to improve its cost structure and return on equity.

Energy giant Centrica reported a 24% drop in half-yearly earnings, as the company wrestled with higher supplementary tax rates and challenging economic conditions in the United Kingdom, but said it is on course to deliver full year earnings growth. For the half year ended 30 June, the company reported adjusted earnings of £673m, compared with adjusted income of £886m, last year. Revenue fell slightly to £11.5bn, down from £11.7bn.Centrica said wholesale gas prices have increased by approximately 30%, reflecting the unrest in the oil-rich Middle Eastern and North African countries, rising global demand for gas and also partly due to the closures of nuclear plants in Japan following the tsunami.

THE FTSE 100 at 10:05                     Down           19          @       5837

THE DOW JONES closed                      Down           198        @       12302 

NASDAQ COMP closed                        Down           75          @        2764                                          Exchange Rates GBP – USD           1.6346 GBP - EURO          1.1375