RAMSEY CROOKALL

12th July

Evening Report

The FTSE 100 closed 1% lower, firmly in the red but off lows as investors tracked European markets. ARM Holdings declined, off 4.9%,  following US peer Novellus Systems' poor 2Q numbers.

Thomas Cook shares shed 28% as the company issues a 3Q profit warning. Bucking the trend was Burberry, up 1.6% as Royal Bank of Scotland raises its price target. Looking ahead to tomorrow, euro-zone industrial production figures and U.K. unemployment data are announced in the morning.

BSkyB continued its decline, a day after Rupert Murdoch withdrew his offer to spin-off Sky News in order to make his bid for the satellite broadcaster feasible. As such, BSkyB said the takeover panel had notified the company that it was no longer in a formal offer period as the News Corp bid has been referred to the Competition Commission for further review.

Plumber's merchant Wolseley was firmly in the red after agreeing to sell its electric centre business unit to electrical products distributor Edmundson Electrical for an undisclosed amount and said the transaction is expected to generate a small gain.

Luxury brand Burberry and high street retailer Marks & Spencer were among the high risers ahead of their first quarter reports due on Wednesday. Burberry is to release an interim management statement, while M&S is due to reveal its quarterly results. Retailing peers Next and Kingfisher were also in demand as the British Retail Consortium's (BRC) Retail Sales Monitor for June came in ahead of estimates.

Both Cairn Energy and Vedanta Resources fell into the red as the companies announced that the latter’s takeover of Cairn India has progressed. Mining giant Vedanta has completed the first tranche of its purchase of Cairn Energy’s Indian subsidiary, after acquiring an additional 10% stake for net proceeds of $1.36bn in cash, raising its stake to 28.5%.                                                                                      THE FTSE 100 closed                  Down               60           @     5868

THE DOW JONES at 4:45                Up                 21           @     12527                                NASDAQ COMP at 4:45                  Down                3           @     2799              Exchange Rates

GBP – USD           1.5938 GBP - EURO         1.1386