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MARKETS & DATA – Equity markets find hangover cure.

UK stockmarket[QQ] Corporate activity spurred the UK market to new record highs: Glaxo and SmithKline Beecham considered merging, GUS bid for Argos and there are persistent rumours of further consolidation in the banking sector. On the demand side, there was some anecdotal evidence that institutions were investing some of their substantial cash balances. Overseas equities Although all the major markets have performed well, the most spectacular returns have come from the smaller Asian markets, last year’s poorest performers. Early signs that painful economic decisions would be taken in response to the crisis were enough to change sentiment. Interest rates Monetary policy remains on hold in much of the world; not surprisingly, the authorities in the US and UK left official interest rates unchanged following recent meetings. The modest revival in investor confidence has led to some reduction in interest rates in Asia, although they remain at levels well above those of a year ago. Exchange rates Among the major currencies, the yen has performed the best in recent weeks, strengthening from almost 135 against the US dollar in early January to under 125 by mid-February. The Japanese government’s willingness to countenance a fiscal stimulus to domestic demand has reduced the force of the argument that economic growth would only be achieved by a boost to the export sector from further yen depreciation. Surveyor: hyper-text, hyper-bid, hyper-spice

 Percent increase in the number of press mentions of the website address prefix "http" between 1995 and 1998           1992% Source: Reuters Business Briefing  The booming bust Average return on capital earned by UK companies in 1997-Q3                                          13.19% Number of years since ROC was this high                                  8 Number of years since unemployment was lower than now                   18  Probability that the UK economy is facing recession, according to Bank of England chief economist Mervyn King                                              less than 1-in-10  Months in a row that industrial production has fallen                    5  Further monthly falls in industrial production before industry is technically in recession                              1 Sources: Experian, The Independent, Financial Times  The value of brains and brawn Value of Compaq's takeover bid for hardware manufacturer Digital Equipment Corporation                          $9.6bn  Value of Computer Associates' takeover bid for IT consultancy and service provider Computer Services Corporation      $9.0bn  Once I've built a railroad ...  Estimated cost of building the Channel tunnel rail link             £5.4bn Market capitalisation of Railtrack                                  £4.3bn Sources: Financial Times, Datastream/ICV  Safer Six Percentage of world's top business executives who are opposed to the Big Four accountancy mergers                            69% Source: Deloitte Touche Tohmatsu  On euro marks, get set ... Proportion of German SMEs that feel positive about the single European currency                                           16% Proportion of British ditto                                            31%  Proportion of German SMEs that don't know what impact the euro will have on their business                                   51%  Proportion of British ditto                                            25% Source: Grant Thornton International/Business Strategies Ltd (0171) 728 2762 (report available in March) Selling what you want, what you really, really want  Number of music CD singles sold by Asda in 1997                       7.2m Market share                                                           14% Source: Asda  Coining it Number of euro coins that will be minted between now and 1 January 2002                                                    76bn  Percentage of people in the UK who believe that notes and coins will eventually become obsolete                              64% Sources: Financial Times; Bull Information Systems/Gallup (0181) 479 2358  Timewatch Number of likely UK interest rate rises between now and launch of the euro                                                       0 Number of likely UK interest rate cuts between now and year 2000         3 Source: interpreted from Liffe short-sterling contract  Expressions of opinion contained within this document are subject to change. Britannia Investment Managers Limited is regulated in the conduct of investment business by IMRO.

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