RAMSEY CROOKALL & CO

EVENING REPORT 14th January 2011

A recovery on Wall Street has helped London narrow losses, although the leading index is in danger of ending the week below 6,000.

Miners were lower amid speculation that commodity hungry China may raise interest rates to cool inflation. The economic powerhouse has lifted reserve requirements on banks, underlining its determination to deal with inflation. Anglo American, Xstrata and Antofagasta were among the miners in the red.

Meanwhile, an increase in inflation here has increased the likelihood that interest rates will be lifted in the near future. Producer prices rose higher than expected in December as the recent hike in commodity prices forced manufacturers to up their charges on goods. Factory gate inflation rose by 4.2% in December, its highest rate since April, the Office for National Statistics said. Forecasts had projected a rise of 3.9%.

Bovis Homes predicts profits for 2010 will beat consensus estimates. A “significant” improvement in profits to more than £16.3m has been driven by a 5% increase in the number of legally completed homes to 1,901 at an average sale price of £160,700, up 4% on the year before. Shares in Smith & Nephew quickly gave up earlier gains after the medical devices group denied reports that it is in any talks that could lead to a merger or takeover. A report in the Daily Telegraph said that it was set to enter talks with the private equity backed US orthopaedics group Biomet about a possible £15bn merger.

Finally, Mexico-based silver and gold miner Fresnillo produced record amounts of both metals last year with output expected to increase again over the coming twelve months.

THE FTSE 100 CLOSED DOWN 21 @ 6002

THE DOW JONES AT 4.30 IS UP 18 @ 11,750

THE NASDAQ COMP AT 4.30 IS UP 5 @ 2740

Exchange Rates

GBP – USD 1.58 GBP – EUR 1.119