RAMSEY CROOKALL & CO

30th March 2012

Evening  Report

The FTSE 100 finished  up 0.5% at 5768 and closes up 3.5% for the quarter. Investors have picked up bargains in industrials, miners and autos following declines in March. Petrofac is the biggest gainer, up 5.0%. Defensive stocks such as tobacco and pharmaceuticals close in the red.

Industrial engineers were on the rise today, with Weir leading the way in the top spot. Sector peer GKN (up 1.8%) was a riser with stock broker Jefferies saying that it believes Volvo Aero would be a "good fit" with GKN Aerospace. "It appears the suggestion GKN might partly fund its acquisition with new equity has caused the market some anxiety. Should the big day arrive, the acquisition would probably stand on its merits, in our view," the broker said. IMI was another big riser.

Miners were also making strong gains, with Kazakhmys, Vedanta Resources, Antofagasta and Rio Tinto all in demand as they regained recent losses. Despite today's 2.7% rise for the mining sector as a whole, stocks are still down an average 8% over the last month. Rio Tinto announced this morning that it has joined the China Beijing Metals Exchange (CBMX), a new electronic trading platform providing additional iron ore trading channels in the Chinese market.

Meanwhile, Shire (down 5%) dropped into the bottom spot on news after one of its drugs missed the main target of a recent clinical trial. The drug was intended to reduce the rate of recurrence of diverticulitis over a two-year treatment period.

Also taking a hit was Vodafone (down 1.29%), after it said it may take a number of courses of action in India, where a change in the tax law has been proposed. Indian to back-date tax charges on overseas transactions involving local assets. The Indian government, still smarting from losing a four-year legal battle to sting Voda for $2.2bn in taxes relating to the UK telecoms giant's acquisition of Hutchison Whampoa's Indian mobile assets, is proposing a change in the law that would be applied retrospectively. The Indian Supreme Court ruled in favour of Vodafone, which had used offshore holding companies to make the acquisition in order to avoid paying taxes.

THE FTSE 100 Closed                          Up  26        @   5,768 THE DOW JONES @ 16.45                        Up 51        @   13,197 THE NASDAQ COMP @ 16.45                      Up 3        @    3,098

Exchange Rates

GBP – USD     @ 16.45            1.5990 GBP - EURO   @ 16.45            1.1997

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