RAMSEY CROOKALL & CO

MORNING REPORT

20 OCTOBER 2010

An overnight slump on Wall Street has made for a muted start as investors wait for minutes from the Bank of England’s last policy meeting and the government’s spending review.

The coalition's Comprehensive Spending Review is fully expected to be a bloodbath, but the City will want clear evidence that cuts will be made swiftly to slash the record budget deficit. Any wishy-washy tactics won’t be tolerated. Falls among the miners has put chip designer ARM’s retreat in the shade. The Cambridge-based company’s intellectual property is used in a number of Apple products and the share price today has been dented by some notes of caution in Apple’s third quarter trading update yesterday evening.

First half underlying pre-tax profits from Premier Inn and Costa Coffee owner Whitbread were in line with market expectations but the company had a pleasant surprise on the dividend front. Housebuilder Bellway bounced back into profit and upped its final dividend as the housing market stabilised though the shares dived, taking several sector peers down with them, after it said "buyer confidence slowly ebbed away during the summer" and sales have picked up only slightly recently.

Real estate investment trust Land Securities has formed a joint venture with the Canary Wharf Group to develop the so-called “walkie-talkie” property in Fenchurch Street, London. The existing property, currently a cleared site with some ancillary retail neighbouring holdings, has been sold by Land Securities to the 50/50 partnership at a price of £90.2m, in line with the March 2010 valuation.

THE FTSE 100 AT IS DOWN 38 @ 5703

THE DOW JONES CLOSED DOWN 165 @ 10,978

THE NASDAQ COMP CLOSED DOWN 43 @ 2436

Exchange Rates

GBP – USD 1. 57

GBP – EUR 1. 113 ??

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