BoE Interest Rate 0.5%; BP Woes Continue

Arthi Gupta, Mayank Mehta and Sanjay Barot
10 Jun, 2010
New York City

The UK markets trade higher led by miners and banks. The Bank of England retains its key interest rate at a historic low of 0.5% and the size of its asset purchase scheme at

[R]4:30 PM London – The UK markets trade higher led by miners and banks. The Bank of England retains its key interest rate at a historic low of 0.5% and the size of its asset purchase scheme at £200 billion. BP Plc shareholders file lawsuit in Louisiana.[/R]

Positive economic data relating to exports and imports in China raise investor sentiment. Ireland’s consumer price index fell 1.1% in May.

In London FTSE 100 Index traded higher 43.62 or 0.86% to 5,129.48 and the pound edged higher to close at $1.459 and edged lower to close at €1.211.

The Bank of England today retained its key interest rate unchanged at a record-low of 0.5% and maintained its £200 billion bond purchase program.

The central bank is set to publish the minutes of the meeting on June 23. This is the first rate decision after the formation of the coalition government on May 11.

The decline in Irish consumer prices slowed for a seventh consecutive month, according to a report by the Central Statistics Office released today

The consumer price index dropped 1.1% in May, compared to the 2.1% fall in the previous month. The CPI rose 0.6% in May, following a 0.2% increase in April.

BP Plc''s shareholders filed a lawsuit in the U.S. District Court for the Eastern District of Louisiana, alleging that the company misled investors prior to the Deepwater Horizon oil spill in the Gulf of Mexico.

The lawsuit, which was filed by Zwerling, Schachter & Zwerling , LLP, noted BP''s prior statements about its Gulf operations being a primary economic driver, and its assertions that it had the technology to safely conduct the operations. Zwerling, Schachter & Zwerling represents all BP shareholders who purchased ordinary shares and/or American Depository Receipts in BP during a period between February 27, 2008 and May 12, 2010.

The company said today it has significant capacity and flexibility in dealing with the cost of responding to the incident, the environmental remediation and the payment of legitimate claims.

BP said that it has spent about $1.43 billion so far in response to the oil well incident, including $60 million funds for the Louisiana barrier islands construction project.

BP Plc fell 24.95 pence or 6.37% and is currently trading at 366.60 pence per share on the London Stock Exchange.

Gainers & Losers

Avocet Mining PLC, the gold mining company rose 0.4% to 126.00 pence.

BP Plc, the oil and gas company fell 5.6% to 369.30 pence.

Halfords Group plc rose 6.2% to 531.00 pence after the car parts and bicycle retailer said fiscal year 2010 revenues rose 2.7% to £831.6 million from £809.5 million a year ago. Net profit for the year rose 38% to £77.0 million or 36.6 pence per diluted share compared to net profit of £55.8 million or 26.6 pence per share a year ago.

Home Retail Group plc, the home and general merchandise retailer fell 5.0% to 225.90 pence.

Park Group plc fell 3.8% to 19.23 pence. The Christmas hampers and financial services firm said fiscal year 2010 revenues rose 5% to £263.2 million from £250.5 million a year ago. Net profit for the year fell 12.5% to £3.5 million or 2.14 pence per diluted share compared to net profit of £4.0 million or 2.43 pence per share a year ago.

Premier Farnell plc surges 12.4% to 247.00 pence after the electronic and industrial components supplier said first quarter revenues rose 20% to £244.9 million from £204.3 million a year ago. Net profit for the quarter rose 157% to £15.7 million or 4.3 pence per diluted share compared to net profit of £6.1 million or 1.7 pence per share a year ago.

PZ Cussons plc, the soap maker fell 0.4% to 295.10 pence.

Salamander Energy PLC, the oil and gas explorer rose 0.5% to 230.40 pence.

UK Coal Plc fell 2.4% to 40.50 pence after the coal miner said that it has received confirmation from Hargreaves Services plc that it no longer wishes to proceed with a merger proposal.