FTSE Slides 1.7%, Pound Plummets

Arthi Gupta, Mayank Mehta and Sanjay Barot
14 May, 2010
New York City

U.K. stocks fall as investors seek refuge in safe-haven currencies. Investors are still jittery about the debt crisis in Europe and the sufficiency of the $1 trillion package to the EU region. Monthly average price of residential property rises. Wolseley plc doubles trading profit.

[R]4:00 PM London, 11:00 AM New York – U.K. stocks fall as investors seek refuge in safe-haven currencies. Investors are still jittery about the debt crisis in Europe and the sufficiency of the $1 trillion package to the EU region. Monthly average price of residential property rises. Wolseley plc doubles trading profit.[/R]

U.K. stocks fall as investors seek refuge in safe-haven currencies and growing concern on the debt crisis in Europe. Investors are still jittery about the debt crisis in Europe and the sufficiency of the $1 trillion package to the EU region. Monthly average price of residential property rises.

Commodity prices are retreating along with mining and bank stocks as traders fear that the economic momentum will slow in reaction to the fiscal crisis plaguing the European nations.

The pound plummeted to a new one-year low against the dollar, four-day low against the euro and a one-week low against the yen and the Swiss franc.

Gold trades at record $1,250 an ounce.

The Bank of England may resume its bond-buying program in August to support U.K. growth and inflation as David Cameron’s government takes steps to narrow Britain’s budget deficit, BNP Paribas SA said.

The central bank will buy “at least” another 50 billion pounds or $73 billion, mainly of gilts, BNP Paribas added.

The monthly average price of all residential property sold in England and Wales in April rose 0.5% from March, despite a fall in transactions, data from Acadametrics showed Friday. This was the twelfth consecutive growth in house prices.

House prices were 12.9% higher than a year ago in April, logging the sixth consecutive increase.

Meanwhile, there were an estimated 50,650 properties sold in April, which was 5% lower than the number of sales recorded in March.

Wolseley Plc, a distributor of plumbing and heating products and building materials reported more-than two-fold rise in trading profit for the third quarter despite lower revenues, driven by improved cost base. The company also expects fiscal 2010 trading profit to come in above analysts'' current consensus estimate.

In London FTSE 100 Index closed lower 161.41 or 2.97% to 5,272.32 and the pound edged lower to close at $1.457 and edged higher to close at €1.166.

Gainers & Losers

Computacenter plc rose 0.3% to 335.00 pence after the independent IT services provider said group revenue for the first quarter rose 7% to £634.4 million.

Gartmore Group Limited, the fund manager fell 1.3% to 149.20 pence.

Intertek Group plc, the global provider of quality and safety solutions fell 1.0% to 1,465.00 pence.

Ladbrokes plc dropped 1.9% to 147.90 pence after the gaming group has reported a net revenue reduction of 6% in the first four months of 2010.

Renishaw plc, the precision tool maker increased 5.4% to 720.00 pence.

Taylor Wimpey plc, the housebuilder fell 0.9% to 38.15 pence.

Wolseley plc increased 7.5% to 1,730.00 pence. The distributor of plumbing and heating products said third quarter revenues fell 7% to £3.25 billion from £3.50 billion a year ago. Like-for-like sales fell 2%. Gross profit for the quarter fell 5.5% to £904 million compared to £957 million a year ago.