STOCKS NEWS UK-National Express down on sluggish Q3 trade

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07:50GMT 22Oct2009-National Express down on sluggish Q3 trade

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Shares in National Express (NEX.L) fall 2.2 percent after the bus and rail operator reports slower third quarter trade with revenues down 1 percent on the prior year period and says its 2009 pretax profit will be below its previous expectations.

The company also says undertaking an equity fund raising is its primary focus but that it is still mulling a merger offer by rival Stagecoach (SGC.L).

"Our past concerns on current trading seem to have been justified. Consensus estimates are likely to fall, and we cannot rule out further downgrades," says Arbuthnot analyst Gerald Khoo.

"It remains to be seen whether Stagecoach is willing to take on the current trading challenges ... although there is clear upside if Stagecoach were to proceed with a formal offer we remain sceptical about the likelihood of completion."

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Reuters messaging rm://rhysl.jones.reuters.com@reuters.net

07:41GMT 22Oct2009-UK small caps down 0.3 pct early on

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The FTSE Small Cap index .FTSC falls 0.3 percent in early trade outperforming steeper falls by the blue chips .FTSE and the mid caps .FTMC, down 1.0 and 0.7 perent, respectively tracking sharp falls overnight on Wall Street and in Asia.