BOC DOWNGRADED TO 'UNDERWEIGHT' FROM 'NEUTRAL' AT JP MORGAN

STOCKWATCH Bunzl started with 'underperform' rating, 400p target at CSFB

REXAM DOWNGRADED TO 'HOLD' FROM 'BUY' BY DEUTSCHE BANK

MARKETS
Tokyo: Nikkei 225 10,977.89, up 144.14
Hang Seng midday 14,092.86, up 197.83

BREAKING NEWS - MONDAY
* BOOTS is having second thoughts about selling sex toys, prompting supplier
SSL to open talks with other stores - FT
* GLAXOSMITHKLINE tells Tony Blair to press G8 for patents reform - Independent
* American flu jabs give GLAXOSMITHKLINE a shot in the arm - Telegraph
* CHIME COMMUNICATIONS walks away from merger talks - Telegraph
* LASTMINUTE.COM chief hints that more job cuts are possible - Guardian
* KINGSTON COMMUNICATIONS to restore dividend payments - Telegraph
* Canary Wharf's board considers Docklands offer - FT
* Germany's Aldi plans 500 mln stg stores push in UK - FT
* E*trade to launch futures platform - FT
* Gordon Brown to boost crackdown on corporate tax avoidance - FT
* Chancellor Gordon Brown defiant as CBI warns of 7 bln stg hole in tax
revenues - Independent
* Contractors urge Chancellor to tackle PFI delays - Times
* Betting chains poised to enter race for National Lottery - Daily Express
* Firms' pensions rejig could cost the Treasury 1 bln stg a year - Times
* Spending on internet advertising set to soar: Zeneith-Optomedia report - FT

MONDAY PRESS COMMENT
FT
Lex Column: US Treasuries (Treasures are clearly not cheap, That does not make them a one-way bet although a catalyst will be required for a significant
shift); TELECOM ITALIA (Proving a deal was at near current prices it could
benefit both TELECOM ITALIA MOBILE and TELECOM ITALIA); Equity Research
(DEUTSCHE BANK may not have a choice. It needs to cut costs and research is an
obvious target. That suggests its peers may not rush to copy Deutsche's
experiment - unless of course it works)

Independent
Small Talk: 121MEDIA (AIM flotation before Christmas should value company at
between 20-30 mln stg if fund managers are attracted); DEBT FREE DIRECT (Watch
out for news); CRESTON (results today will show progress with the integration
of CML Research); BANK RESTAURANTS (might just be a tasty morsel from the
stock market undercard); MONKLEIGH (about to do its second deal since floating
on AIM in July); GLOBAL GAMING CORP. (the plan is to inject a sports
betting company into the cash shell, with widespread expectations such a deal
will value the shares at 12 pence each); ATI OIL (first Ofex company to have
been spun out of an AIM firm starts trading today)

Times
Rumour of the day: CHIME COMMUNICATIONS/INCEPTA (Held extensive merger talks
but have failed to reach agreement. However the prospect of a deal is not dead
and talks are set to restart next year) -- Smaller Stock to Watch:
ANGLO-PACIFIC

Morning all.

STOCKWATCH Severn Trent reiterated 'neutral' at CSFB post-H1

LONDON (AFX) - Shares in Severn Trent PLC were reiterated a 'neutral' at CSFB after the utility group posted slightly better-than-expected interim numbers, dealers said.
In a note to clients, the broker said headline EBITA was down 2.2 pct to 229.3 mln stg, against its own estimate of 224 mln, while pretax profit fell 6.5 pct to 141.3 mln, compared with a consensus estimate of 138 mln.
The fall in year-on-year profit was due to the inclusion of a 15.1 mln stg increase in pension costs, which is expected to impact full-year results by
32 mln, the broker added.

Morning punters!

ARK - partnership with TTC
http://www.uk-wire.com/cgi-bin/articles/20041129070000Z7139.html

NTP - manufacturing partner for lead product
http://www.uk-wire.com/cgi-bin/articles/200411290700077265F.html

CWV - poor trading update, which was in the chart
http://www.uk-wire.com/cgi-bin/articles/200411290700097306F.html

ITH - in bed with Porsche - classy! ;-) Chart says it leaked? ;-))
http://www.uk-wire.com/cgi-bin/articles/200411290700097297F.html

COL - acquisition
http://www.uk-wire.com/cgi-bin/articles/200411290700197332F.html

PRE - disappointing drilling update?
http://www.uk-wire.com/cgi-bin/articles/200411290700287353F.html

KIE - nice AGM statement
http://www.uk-wire.com/cgi-bin/articles/200411290700307355F.html

HNR/ROC/PMO - disappointing drilling update from Mauritania?
http://www.uk-wire.com/cgi-bin/articles/200411290701407406F.html

TLW - looks good in Banglabesh
http://www.uk-wire.com/cgi-bin/articles/200411290700437396F.html

CCT - dispute settled in its favour = exceptional profit!!
http://www.uk-wire.com/cgi-bin/articles/200411290700447403F.html

UKC - not the best trading update?
http://www.uk-wire.com/cgi-bin/articles/200411290700447404F.html

CHW - possible merger with ITA off
http://www.uk-wire.com/cgi-bin/articles/200411290700447401F.html

HYC - interims seem way ahead of FY forcasts.
http://www.uk-wire.com/cgi-bin/articles/200411290700047063F.html

BTSM - nice interims. I'm long!!
http://www.uk-wire.com/cgi-bin/articles/200411290700057169F.html

TOPS - fair discount to NAV
http://www.uk-wire.com/cgi-bin/articles/200411290700127315F.html

DWN - in line FY
http://www.uk-wire.com/cgi-bin/articles/200411290700127314F.html

ASC - decent set of interims, but price has flown this year
http://www.uk-wire.com/cgi-bin/articles/200411290700167324F.html

MTO - interims inline
http://www.uk-wire.com/cgi-bin/articles/200411290700147320F.html

DGG - interims look OK
http://www.uk-wire.com/cgi-bin/articles/200411290700157323F.html

ILX - chart been poor, but interims seem to be pointing to a turn. Hmm
http://www.uk-wire.com/cgi-bin/articles/200411290700267347F.html

Well, that's all folks. I've probably missed something, but such is life!

Have a good day/week.

London shares near highs midmorning; financials up as dollar firms

LONDON (AFX) - UK blue chips remained stronger in solid midmorning trade, hovering near session highs supported by solid gains in financial issues as the US dollar managed a rally after recent declines, dealers said.
At 10.04 am, the FTSE 100 index was 46.4 points higher at 4,788.1, just below the session peak of 4,791.0 having dipped back to 4,739.5 at open.
The broader FTSE indices were more modestly higher.
Volume was fair with 388 mln shares changing hands in 38,180 deals.
Today's UK data provided more evidence of slowing consumer credit and mortgage lending as the Bank of England's recent rises in borrowing costs take their toll.
UK net new consumer credit in October fell for the second month running to reach 1.549 bln stg from 1.624 bln the previous month. The reading was in line with predictions but is still the lowest since April this year.
Strength in financial issues provided the main fuel for blue chips in London midmorning, with hedge funds provider Man Group a good performer, up 25 pence to 1,489, while Old Mutual topped the FTSE 100 risers, ahead 2-1/2 pence at 131.
Bank stocks rallied as well, with Barclays rebounding 9 pence higher to 552 after a dismal performance last week, helped by a target upgrade to 550 pence by JP Morgan.
Other banks were also higher -- Lloyds TSB shares rose 7-1/2 pence higher to 430-1/4, and HSBC gained 13 pence at 904-1/2 aided by strong gains today in Hong Kong.
Away from financials, pharma stocks rebounded as well after being hit last week by the US dollar decline -- GlaxoSmithKline rose 13 pence higher to 1,133 aided by share buy-backs, and AstraZeneca was up 22 at 2,102 helped by news of European approval for a heart drug, Atacand.
And mining issues also benefited from the firmer dollar, with commodity prices higher as a result -- Anglo-American added 19 pence at 1,293, Xstrata gained 4 pence at 942, and Rio Tinto firmed 19 pence at 1,559 amid talk the group could counter-bid Xstrata's hosile offer for Australia's WMC.
Utility stocks stayed in focus after the regulator Ofgem announced that electricity distribution companies will be allowed a 1 pct real, or inflation-adjusted, increase in charges from April 2005.
The allowed increase in charges was in line with expectations, and there was relief that the regulator did not impose stricter guidelines.
In reaction, Scottish Power shares rose 3-3/4 pence higher to 396-1/4, while Scottish & Southern Energy took on 5 pence at 823 pence higher at 819.
Meanwhile water blue chips Severn Trent rallied from initial falls, gaining 1-1/2 pence at 895 as fears over accounting irregularities were countered by the firm's slightly better-than-expected interim results.
Severn Trent posted profit before tax and exceptional items of 126.2 mln stg, down from 136.2 mln stg last time out, but near the top of the 118-128.4 mln stg market range.
There were few blue chip fallers left by midmorning.
Rentokil Initial shares topped the fallers list, down 1-3/4 pence to 152-3/4 ahead of an update due tomorrow, with Citigroup Smith Barney -- repeating its 'sell' rating -- expecting a further deterioration in trading at teh support services firm.
Elsewhere, negative broker comment pulled Dixons shares down 0-1/2 pence to 148-3/4, with Lehman downgrading its stance on the electricals retailer to 'underweight' from 'equal-weight' in a cautious pre-Christmas sector review.
Rexam also suffered, losing 1-1/4 pence at 460 after Deutsche Bank downgraded its rating for the beverage can maker to 'hold' from 'buy' following a strong run by its share price.
There were more weak performers on the second line.
Premier Oil headed the FTSE 250 fallers list, shedding 30 pence to 576 after news that tests on its Merou-1 well offshore Mauritania indicate it is not commercial.
In response, Merrill Lynch stuck to its 'sell' stance, noting Premier has drilled 3 exploration wells in Mauritania, two of which have not been a commercial success.
Elsewhere, Kidde shares shed 6 pence at 150 after the Observer newspaper claimed that United Technologies has decided to walk away from a bid for the firm after the UK group refused access to its books.
There was a buzz around SSL International on reports that Boots is pulling out of a deal in which it would sell a range of SSL's sex toys in its stores.
SSL shares lost 9-1/4 pence at 288-1/4.
Meanwhile shares in MITIE Group fell back 1-3/4 pence to 155-1/2 as a slide in margins at its building and supports services operations offset a 22 pct rise in interim profits and an upbeat outlook.
In response, Investec reduced its stance on the group to 'hold' from 'buy'.
And pubs group Mitchells & Butler shed 4 pence at 297 after being cut to 'hold' from 'buy' by Citigroup Smith Barney on valuation grounds ahead of the group's full-year results due this Wednesday.
But among the midcap gainers, EMI Group shares took on were 4-1/4 pence higher ar 248-1/4 as Citigroup Smith Barney turned buyer on the music group.
The broker argued recent first half results mitigated concerns over 2004/05 earnings, with the group predicting a high level of confidence in profitability and sales given strong growth in October and November.
And Novar shares rose 4-1/4 pence higher to to 164-3/4 amid weekend press reports suggesting Melrose Resources will launch its bid for the firm this week.

Good morning all from a nice sunny North Wales. Nice to see the Banks recover a bit this morning.

STOCKWATCH Lloyds TSB in demand as Merrill Lynch warms to stock

LONDON (AFX) - Shares in Lloyds TSB Group PLC were higher in late morning trade amid positive comments from Merrill Lynch, dealers said.
In a note to clients, the US broker noted that although Lloyds TSB has been a serial underperformer and is generally unloved by the market due to earnings fears and capital concerns, it is hard to see much downside without a backdrop of a market rout.
Merrill said it thinks the current valuation of Lloyds TSB makes the stock interesting from a yield perspective, particularly in an environment which makes overall market progress sluggish.
Overall, the US broker added that although it is retaining its 'neutral' recommendation on the stock, it is comforted by recent market trends which suggest the downgrade cycle of the recent past may be over.
By 11.20 am Lloyds TSB shares were up 7-3/4 pence to 430-1/2.

London shares - midday features

FTSE 100 risers
Reuters 396-3/4 up 7-1/2
Merrill sees Instinet take-out value at 6.50-7.30 usd a share
Lloyds TSB 430-1/4 up 7-1/2
Merrill positive
HSBC 903-1/2 up 13
US dollar rebounds; UBS 'buy
Barclays 550 up 7
Rebound; JP Morgan ups target to 550 pence
Rio Tinto 1,560 up 20
Investec raises commodity price estimates
Old Mutual 130-3/4 up 2-1/4
Insurers rally
Anglo American 1,287 up 14
Investec raises commodity price forecasts
SABMiller 889 up 10-1/2
Rand stronger; sector consolidation talk

FTSE 100 fallers
Rentokil 150-3/4 down 3-3/4
Citigroup negative ahead of trading update tomorrow; rates 'sell'
Dixons 146-3/4 down 2-1/2
Lehman cuts to 'underweight
Rexam 458-3/4 down 2-1/2
Deutsche cuts to 'hold' from 'buy'
Severn Trent 892-1/2 down 1
Good H1 figs offset by accounting worries

FTSE 250 risers
Investec 1,512 up 45
Strong rand
Invensys 17-3/4 up 3/4
Vague bid speculation
Novar 162-3/4 up 2-1/4
Seeks white knight
EMI 248-1/2 up 4-3/4
Citigroup upgrades to 'buy'
Big Food Group 88-3/4 up 1-1/4
Bid hopes
easyJet 185 up 1
Recent results; ongoing bid hopes
Paladin Resources 181-3/4 up 1-3/4
Joint venture gets UK govt approval for Brechin Field development

FTSE 250 fallers
Premier Oil 574-1/4 down 31-1/2
Mauritania drill results disappoint
Kidde 151 down 5
Fear UTC will pull bid
SSL International 288-1/2 down 9
Fears Boots may cancel sex toy deal
Jardine Lloyd Thomson 357-1/2 down 8-1/2
Negative broker comment after profit warning last week
Mitie Group 154 down 3-1/4
Margins slip; cut to 'hold' at Investec
Mitchells & Butlers 298-1/2 down 2-1/2
Downgraded to 'hold' from 'buy' at Citigroup Smith Barney
Electrocomponents 295 down 3
Started with 'underperform', 260p target at CSFB
Arla Foods 55-3/4 down 3/4
Interim results tomorrow
Woolworths 44-1/4 down 3/4
Concern over Christmas trading
GWR 224-1/2 down 3-1/2
Weak sector sentiment
De La Rue 330-3/4 down 6-1/2
Results due Friday
Lastminute.com 99-1/2 down 1-1/2
Negative weekend press comment
Carphone Warehouse 163-3/4 down 2-1/4
Worry over Christmas trading
Tullow Oil 147-1/2 down 2-3/4
Bangladesh gas find fails to inspire

Other risers
Central African Mining 6.00 up 1.50
'Sell the shares when they get to 13 pence' - Sunday Telegraph
GeneMedix 13-1/4 up 2
Wins US patent for monomeric analogues of human insulin
Caspian Holdings 225 up 37-1/2
Co identifies 7 new wells in Zhengeldy fields
ZincOx Resources 72-1/2 up 8-1/2
Positive study on Aliaga zinc oxide recycling project
Formjet 4.50 up 0.38
Chairman and CEO Lyndon Chapman buys 100,000 shares
Charteris 31 up 2-1/2
Co says made good start to new FY, confident of meeting expectations
Tecteon 3.37 up 0.25
Co delivers business telephony product to telecom equipment manufacturer
ARC International 33 up 2-1/4
Inks deals with Broadcom and TTPCom
Archipelago Resources 29-1/2 up 2
Co seeks debt finance, placing for Toka Tindung gold project
African Eagle Resources 29-1/4 up 1-3/4
Upbeat licence news
Dawson Holdings 166-1/2 up 8
FY results please
Belhaven 428-1/2 up 7-1/2
Record interims

Other fallers
CMS WebView 2.00 down 1.37
Starts business strategic review
Pan Andean 17 down 8
Reduced gas reserves estimate
UK Coal 140 down 28-1/2 pence
Provisions warning; William de Broe cuts to 'sell'
London & Boston Investments 5.37 down 0.63
Capital reduction plans announced last Friday
World TV 1.25 down 0.12
Co says underperformed in 3 mths to Sept but EBITDA positive in Oct
Courts Suspended at 1-1/4
Shares suspended as lenders reject waivers for covenant breaches
Caledonian Resources 6.00 down 0.50
Raises 1.35 mln stg via placing of 23 mln shares at 4.5 pence each
Hardman Resources 79 down 6-1/2
Disappointing drilling report
ASOS 76-1/2 down 5-1/2
Interims fail to impress

Greystone, Have sent you email.

This week's great Thoughters article by -Gold Dog- is now published above.

Sincere apologies to the pooch and to you all for the delay which appears to have been caused by my over-zealous application of e-mail filters. :-(

It is a really good read that I'm sure you will enjoy.

G.

Thanks Greystone. There is a pint of your fav tipple on the bar in the Tea rooms for you when ever you want it.
:-)

On a roll. The spread is too big and the nms too small (500, with MMs usually quoting 1000), but the stock is nice.

Nice one goldie,keep the faith,





































and try and hold on to the money,,dd.

long WTB 803.75 s/l on

covered LAND +9 BLND +16.25 SOF +5.75

long more WTB 801.75 s/l on

GD - Good thoughts piece, open and honest - Well written Poochy!!
:>)

long S&P 73.8 s/l on

Poochy - Really enjoyed your writing but it struck too many familiar chords (including Wiggins)!! xx