BAT subject of downgraded earnings forecast

British American Tobacco, which has been speculated in recent days to be eyeing up rival Gallagher as a takeover target, has been the subject of downgraded earnings forecasts because of the impact of the weak US dollar and lower volumes.

However, annual figures on Tuesday are still expected to show a solid performance with fund manager Gerrard pencilling in profits of £2.54bn (€3.73bn) compared with £2.5bn (€3.68bn) a year earlier.