This Morning in London blue-chip stocks were firmly lower, with British Airways (BAY) falling after earnings news. The airline's shares fell 16.25p at 413.75p after the group saw its first half pretax profit rise by 26% on steady growth in premium traffic and a strong cost performance, helped by the weak US dollar. However, BA said fuel costs 'remain a major challenge' and said the carrier's fuel bill for the year was expected to top £2bn for the first time. BA said it had revised its revenue guidance to 3%-3.5% because of the continued weakness of the US dollar but said it sees 'every possibility' of achieving its 10% operating margin by March 2008. At 10:00 the FTSE-100 was down 74 points at 6,512.1 with the FTSE-250 off 111.5 points at 11,414.8.
BROKER RECOMMENDATIONS
Citigroup has downgraded Autonomy (AU.) to hold from buy.
Credit Suisse reiterates neutral on Northumbrian Water (NWG) (raising the price target to 350p from 321p).
Deutsche reiterates hold Premier Foods (PFD) (cutting the price target to 230p) and reiterates buy Shire (SHP).
The broker reiterates hold Unilever (ULVR) and ICI (ICI) and has downgraded ProLogic (PGC) to hold from buy.
Dresdner Kleinwort has downgraded BAT’s (BATS) to hold from buy (1925p target price).
HSBC has initiated coverage of Northumbrian Water (NWG) appending an overweight recommendation and a 380p price target.
KBC Peel Hunt says sell Domino's Pizza (DOM) and hold Regent Inns (REG).
Lehman has upgraded Diageo (DGE) to equalweight from underweight.
Merrill has downgraded BAT’s (BATS) to neutral from buy (cutting the price target to 1830p, on valuation grounds).
JP Morgan has upgraded CRH (CRH) to overweight from neutral (€37 target price).
SG Securities reinitiates coverage of Burberry (BRBY) appending a hold recommendation.
UBS has downgraded Moneysupermarket.com (MONY) to neutral from buy and Dexia (DEX) to sell from hold.
NEWS ROUND-UP
Last Night in New York stocks swooned, with the Dow industrials sliding more than 360 points, as a downgrade of Citigroup revived concerns about woes in the financial sector, sobering up markets after the euphoria of the Federal Reserve's rate cut the previous day. Speculation that problems with bad home loans at Citigroup will force the bank to cut its dividend or take more write-downs led to rumors about problems at other banks. The Dow Jones ended down 362 points at 13,567, its worst day since 19th October, which marked the anniversary of Black Monday. The S&P fell 40 points to 1,508, while the Nasdaq lost 64 points to stand at 2,794.
On this day:-
2003 - Sir Ranulph Fiennes and companion Mike Stroud completed their 7th marathon in 7-days, each in a different country. Fiennes had suffered a heart attack 5-months previously.
1997 - American Craig McCaw, who pioneered the mobile phone, agreed a record $277-million divorce settlement with his wife Wendy.
1964 - The first episode of the television soap opera 'Crossroads' was broadcast on ITV.
1962 - US President John F Kennedy announced that the 'Cuban Missile Crisis' was over, after ships carrying nuclear missiles to Cuba were ordered to return to Russia.
1960 - In Great Britain, Penguin publishers were cleared of obscenity, for printing the D.H.Lawrence novel 'Lady Chatterley's Lover'.
1957 - Rock 'n' roll star Elvis Presley set an all-time record with 8 hit singles in the UK Top 30 chart at the same time.
1954 - The comedy series 'Hancock's Half Hour' was first broadcast on BBC Radio.
1953 - The founding of the Samaritans.
1930 - Ras Tafari, King of Ethiopia, was crowned Emperor Haile Selassie.
1924 - Almost 11-years after its appearance in America, the first 'crossword puzzle' was published in a Great British newspaper, sold to the Sunday Express by C.W. Shepherd.
1917 - Great Britain issued the 'Balfour Declaration on Palestine', promoting the idea of creating a national Jewish homeland in the Middle East.
1903 - The publication of the 'Daily Mirror' newspaper, designed especially to be read by women.
1899 - Boer War: The start of the siege of Ladysmith in Natal, when Boers encircled Great British troops and civilians inside the town.
1871 - Great British police began their 'Rogue's Gallery', taking photographs of all convicted prisoners.
1841 - The start of the Second Afghan War.
