RAMSEY CROOKALL & CO

EVENING REPORT

28 SEPTEMBER 2010

Expectations of a firm start on Wall Street have lured buyers back into the market in London and the blue-chip index ended the afternoon session barely changed on the day.

Hedge fund manager Man has been usurped as worst performing FTSE 100 stock by weapons systems developer BAE Systems. Defence firms are out of fashion today after high-tech weapons group QinetiQ said that uncertainty over defence spending plans in both the UK and US has reduced visibility and meant delays in orders.

Man is still in the dog-house, however, after its glum pre-close trading update. The hedge fund firm’s first half profits will fall by a fifth to $215m as performance fees dwindled after a tough half for its flagship AHL fund. Funds under management have stabilised recently and the end of September were up over the previous three months to $39.5bn from $38.5bn.

Charles Stanley is sitting on the fence with its view on Man. It likes the yield, but wants to see improvement in trading before it switches from its “hold” recommendation.

Among second liners tour operator Thomas Cook is the big faller after it said it has now started a review of its UK cost base following softer than expected business over the summer and in view of the difficult market backdrop. "Our cost experience in the UK has not been as favourable as expected, particularly in the airline, and this will result in a net impact of around £10m on the underlying operating profit," Thomas Cook said. It will take a £10m restructuring charge.

THE FTSE 100 CLOSED UP 5 @ 5578

THE DOW JONES AT 4.30 IS UP 35 @ 10,847

THE NASDAQ COMP AT 4.30 IS DOWN 9 @ 2360

Exchange Rates

GBP – USD 1. 58 GBP – EUR 1. 167

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