RAMSEY  CROOKALL                                                                                    6th  July    Morning Report

The FTSE 100 trades down 0.44%, extending losses as banking stocks decline amid renewed worries about sovereign debt contagion after Portugal's credit rating was cut by Moody's. RBS is the biggest faller, down 3.1%, while Barclays follows right behind, down 3%. There are no UK data releases of note due today, but eyes will be on euro-zone 1Q GDP and German industrial orders. US ISM non-manufacturing data is also released later today.

Deutsche Bank has raised Associated British Foods target to 1050p from 950p. It has noted that favorable dynamics in European sugar are likely to keep prices high and generate a major windfall for Associated British Foods.

Advertising conglomerate WPP is one of the heaviest fallers in the large-cap index. It has acquired a majority stake in Indian advertising agency, Mindset Advertising.

Also in advertising and marketing Cello dropped after saying it expects profits for the full year to fall slightly short of expectations after losing a retail research contract earlier this month and seeing one of its retail clients entering administration. The company expects to incur a full year exceptional charge of about £500,000.

Sportswear retailer Sports Direct’s move into the fashion world with the acquisition of 80% shareholdings in the Scottish fashion chains USC and Cruise Clothing for £7m has pleased the market.

Turning to smaller companies, shares in Coal of Africa roared higher after the miner said it had been granted approval to build its project at Vele in South Africa. Construction is expected to be completed in six to nine months and production is expected to reach 1m tonnes a year.

THE FTSE 100 @ 9.45 IS Down 25 @ 5998

THE DOW JONES closed                    Down            12      @    12569                                 NASDAQ COMP closed                      Up              9       @    2825                                              Exchange Rates GBP – USD           1.6012 GBP - EURO         1.1144