RAMSEY CROOKALL & CO

EVENING REPORT

2 NOVEMBER 2010

The FTSE 100 finished up this afternoon as investors digested a busy morning of big company announcements.

Beleaguered oil giant BP comfortably beat third quarter profit forecasts though it has had to take an additional $7.7bn charge in respect of the Gulf of Mexico oil spill. The market had been expecting underlying net income on a replacement cost basis to be around $4.5-$4.6bn, but after what it termed a “strong operating performance” BP boosted profits by 18% from a year earlier to $5.5bn.

Elsewhere, both BP and BG were firmer but both trail in the wake of sector peers Tullow Oil and Royal Dutch Shell as the oil price adds to yesterday’s gains. Meanwhile, miners are strong in line with firmer metals prices. Kazakhmys and Antofagasta are two of the best performers.

Better margins at its core banking business and bad debts under control kept state-controlled bank Lloyds, down 3%, on track over the past three months, despite 'subdued' loan demand. Impairments, or bad debts, have continued to decline and for the full year the level is expected to be in line with Lloyds' recent indications. Wholesale impairments will be lower than expected offset by higher Wealth and International charges, originating in Ireland and Australia primarily.

Finally, insurer Aviva is on track to deliver strong profitable growth for 2010 after a decent third quarter following “good sales growth” from both life and general insurance businesses. Worldwide total sales were up 5% during the first nine months of 2010 at £35.9bn, long-term savings sales rose 6% to £28.6bn, and total life and pension sales also grew by 6% to £25.6bn.

THE FTSE 100 CLOSED UP 65 @ 5760 THE DOW JONES AT 4.30 IS DOWN 6 @ 11,124

THE NASDAQ COMP AT 4.30 IS UP 2 @ 2504

Exchange Rates

GBP – USD 1. 60

GBP – EUR 1. 15

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