This Morning in London... talk about timing! – The recent interest rate rises are beginning to bite in a way that was not initially planned. The over-heating housing market needed to be reined-in, so, in time for the winter "close-down" within the building industry, the rate rises of months ago (it normally takes between 3-to-6 months before the impact of a rate move is felt) are impinging at a time that the credit-crunch has government’s, businessmen and economist’s considering possible recession. If the Bank of England’s Monetary Policy Committee do decide to cut rates today, by the time that any impact is felt in the property and housing sector’s, possibly 3-months, it should coincide with the building industry coming out of its winter close-down. A rate cut today will have an immediate effect on commerce and foreign exchange. Although stockbroker Numis (NUM) reported an increase in its full year pre-tax profit, it did add that the current market conditions were difficult, with the outlook uncertain. However, the broker did say that profits are currently ahead of those at the beginning of December last year, despite difficult market conditions. At 10:12 the FTSE-100 was up 27.4-points at 6521.2, as investors gamble on a rate cut.
Bear Stearns has upgraded Brit Insurance (BRE) to peer perform from market perform.
Cazenove has underperform on Royal Bank of Scotland (RBS).
Collins Stewart says buy Standard Chartered (STAN).
Deutsche has upgraded WH Smith (SMWH) to buy from hold, Halfords (HFD) to buy from hold and has downgraded Carphone Warehouse (CPW) to hold from buy.
The broker says buy Tesco (TSCO) and says hold Sainsbury (SBRY) and William Morrison (MRW).
Deutsche has cut targets across the board in the UK non-food retail sector.
Goldman has downgraded Bradford & Bingley (BB.) to sell from neutral and has neutral on Wolseley (WOS) (cutting the price target tom 890p from 935p).
Morgan Stanley has overweight on Daily Mail & General Trust (DMGO) (cutting the price target to 650p from 780p).
NEWS ROUND-UP
Last Night in New York stocks leaped ahead for the first time this month, with technology shares fronting the advance, after data cast a more optimistic light on the US economy, while leaving intact hopes of another interest-rate cut next week. Up more than 200 points in the final 30 minutes of trade, the Dow Jones rose 196.2 points to finish at 13,445, with 29 of its 30 components ending higher. The S&P gained 22.22 points to 1,485.01, while the Nasdaq advanced 46.53 points to 2,666.36.
On this day in:-
1993 - An American court ordered actress Zsa Zsa Gabor and her husband to pay $1.3-million damages for libelling German film star Elke Sommer.
1982 - An IRA bomb killed 16 and injured a further 60 at the Droppin Well disco, in Ballykelly.
1963 - Call-girl Christine Keeler, one of the models named in the scandal involving Secretary of State for War John Profumo, was jailed for 9-months for perjury, arising from the trial of an ex-boyfriend.
1958 - Japan launched the world's largest oil tanker.
1936 - Characters Desperate Dan and Korky the Cat made their first appearance in the comic 'Dandy'.
1921 - Irish Independence was granted to the 26 states in southern Ireland which become known as the Irish Free State. The 6 counties of Ulster, in Northern Ireland, remained part of the United Kingdom.
1917 - Finland gained its independence.
1916 - David Lloyd George became Prime Minister.
1907 - At least 360 miners were killed in a pit disaster in West Virginia, USA.
1906 - Great Britain granted self-government to the Transvaal and the Orange River Colonies in southern Africa.
1897 - The world's first fleet of motorised taxi cabs started operating in London.
1877 - The world's first recording of the human voice was heard, when the inventor of the phonograph, Thomas Edison, recited 'Mary Had A Little Lamb' and played it back.
1857 - During the Indian Mutiny, Great British troops recaptured the town of Cawnpore.
1492 - Explorer Christopher Columbus discovered Haiti.
