RAMSEY CROOKALL

30th   June 2011

Afternoon Report

The FTSE 100 is up 0.45%, broadly holding steady with investors responding positively to some upbeat corporate news after recent declines. Still to come on the macro side, U.S. weekly jobless claims data and the Chicago PMI reading later this afternoon.

Lloyds Banking Group is the biggest gainer, up 7.0%, as investors react favorably to the bank's cost-cutting plans and its aim to return to profitability so the government can sell its 41% stake in the bank. The part-nationalised high street behemoth, is aiming to shed a further 15,000 jobs and cut its presence in foreign markets by half. The announcement today comes as part of a review of the business by its new Chief Executive, António Horta-Osório. Other notable aims include an investment programme in new IT systems. This combined with the job cuts is likely to cost £2.3bn. Other banks are also in demand, including Royal Bank of Scotland and Barclays.

BG Group, the FTSE-100 gas and oil company, has risen strongly after it doubled the estimate of how much oil there might be in its Santos Basin site, 300 km off the coast of Brazil. Oil peers BP and Royal Dutch Shell are also higher.

Oilfield services firm Wood Group said today that it has seen good growth in the year to date and expects full-year numbers to be in line with expectations. Sector peer Petrofac, however, has bucked the sector trend despite saying that it is on course to deliver its target of at least 15% like-for-like net profit growth in 2011. Petrofrac is currently trading down 3.0%.

THE FTSE 100 at 12:00                        Up            28          @    5884

THE DOW JONES closed                         Up            72          @    12261

THE NASDAQ COMP closed                       Up            11          @    2740   Exchange Rates GBP – USD           1.6007 GBP - EURO          1.1056