RAMSEY CROOKALL

12th July

Morning Report

The FTSE 100 is down 1.6%, dropping over 120 points in early trading but now off by around 100 points. CPI data is softer than expected, declining to 4.2% in the 12 months to June, compared with 4.5% in May. Meanwhile, investors are keeping an eye on rumors that the European Central Bank is buying peripheral debt.

Thomas Cook’s shares are down by more than a fifth after it said its third quarter results will miss expectations as the turmoil in the Arab world and economic weakness in the UK take its toll on the travel operator. The firm said its French operations have been hit particularly hard by the political unrest in countries such as Egypt, Tunisia and Morocco. Peer TUI Travel is also hurt.

Oil outfit Premier Oil moved to assure the market about production targets saying it predicts a sharply increased production rate of around 60,000 barrels of oil equivalent per day by the end of the year, as its Asian development projects ramp up output.

Information technology solutions provider Computacenter said profitability in the first half of its financial year will be comfortably ahead of the same period last year, and trading at this stage remains in line with management expectations for the year as a whole.

In economic news, the retail sales environment improved slightly in June, but conditions remain tough due to consumer caution and shops are having to launch sales to draw in customers, according to the British Retail Council (BRC). Total sales were up by 1.5% during June, having fallen by 2.1% in May.                                                                                

THE FTSE 100 at 10:00                       Down                98           @     5830

THE DOW JONES closed                        Down                151          @    12505                                 NASDAQ COMP closed                          Down                 57          @     2802                                      Exchange Rates

GBP – USD           1.5817 GBP - EURO          1.1372