RAMSEY CROOKALL & CO

EVENING REPORT 16th DECEMBER 2010

The FTSE 100 still looking for direction following a mixed start on Wall Street.

Oil giant BP was under pressure after news last night that the US government is to sue over the Gulf of Mexico oil spill It filed a civil lawsuit against BP and eight other companies over the Deepwater Horizon oil rig explosion and the subsequent oil spill in the Gulf of Mexico. Elsewhere, an upbeat trading update from Serco impressed. The outsourcing giant stated again it expects strong organic revenue growth this year with demand strong in most areas of operation. The group, which is a big outsourcer to the public sector, reiterated previous guidance of an increase in revenue to around £5bn and a rise in adjusted operating profit margin to about 6.3% by the end of 2012. Peer Capita was also higher.

In the mid-cap index, Sports Direct was in demand after it posted a sharp rise in profits in the half year to 24 October as the football World Cup and strong growth in internet shopping boosted sales, but the sports shop chain is anticipating a tough start to the new year. Underlying pre-tax profits were up to £100.7m, from £71.9m the previous year on revenues that climbed to £819.9m from £756.9m. “The group has continued to perform strongly during the first eight months of this financial year,” said boss Dave Forsey.

Financial software provider Misys was also wanted after saying it will buy back £525m of shares at 310p each via its tender offer, with the remaining £145m dished out by way of a pro rata return of capital to all shareholders. The company committed to handing back £670m to investors following the sale of a big stake in healthcare division Allscripts earlier this year. It still owns 10%.

THE FTSE 100 CLOSED DOWN 1 @ 5881

THE DOW JONES AT 4.30 IS UP 29 @ 11,486

THE NASDAQ COMP AT 4.30 IS UP 14 @ 2217

Exchange Rates

GBP – USD 1.55 GBP – EUR 1.18

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