Record Low Rates; Unilever Drops 6%

Arthi Gupta
05 Aug, 2010
New York City

The UK indexes slide after the BoE retained key rate at 0.5% and

[R]4:30 PM London – The UK indexes slide after the BoE retained key rate at 0.5% and £200 billion bond purchase. The UK new car sales slump in July. Irish live register total rises in July. BP gets authorization to begin cementing procedure on MC252 well.[/R]

In London, FTSE 100 Index traded lower 21.53 or 0.40% to 5,362.99 and the pound edged higher to close at $1.5897.

The Bank of England left its key interest rate unchanged at a historic low again. The Monetary Policy Committee decided to retain the interest rate at 0.5% at the end of two-day rate setting meeting. The current rate is the lowest since the central bank was established in 1694.

Policy makers also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at £200 billion. The minutes of the meeting will be released on August 18.

New car registrations in the UK slid 13.2% or 20,703 units in July compared with the same month a year ago, according to a report published by the Society of Motor Manufacturers and Traders today.

Total 2.02 million units are expected to be sold in the year, 1.2% above the 2009 market.

Irish live register total increased in July from the previous month. The seasonally adjusted live register total edged higher to 452,500 in July from 444,000 in the previous month, according to a report released by the Central Statistics Office Ireland today. A year ago, the live register total was 418,100.

The standardized unemployment rate rose to 13.7% in July from 13.4% in the previous month. A year earlier, the jobless rate was 12.2%.

National Incident Commander Admiral Thad Allen authorized BP plc to cement the damaged well in the Gulf of Mexico based on the successful completion of the ""static kill"" procedure and a positive evaluation of the test results. Allen added that implementation of this procedure shall in no way delay the completion of the relief well.

Pumping operations are expected to begin on Thursday, August 5th. The aim of the procedure is to assist with the strategy to kill and isolate the well, and will complement the upcoming relief well operation.

Gainers & Losers

Aviva plc surges 6.82% to 393.00 pence after the insurer stated half-year IFRS operating pre-tax profit grew 21% to £1.27 billion from £1.05 billion a year ago.

Barclays PLC slumped 4.86% to 323.35 pence after the banking group said pre-tax profit rose 44% to £3,947 million in the first half of 2010 compared with £2,745 million in the first half of 2009. Total profit attributable to equity holders of the parent was £2.43 billion, compared to £1.89 billion in the prior year. Earnings per share grew to 19.7 pence from 17.1 pence a year ago.

BP plc rose 2.16% to 40.24 pence after the oil and gas explorer received authorization by the National Incident Commander to begin cementing its Macondo well.

Capital Shopping Centres Group plc gained 0.53% to 340.20 pence after the property company reported interim profits of £291.2 million in the first half of 2010 compared to a loss of £495.1 million in the first half of 2009.

RSA Insurance Group plc soared 3.58% to 133.30 pence after the holding company reported net written premiums in the first six months of 2010 rose 9% to £3.80 billion from £3.49 billion in the first half of 2009.

Schroders plc advanced 3.21% to 1,381.00 pence after the asset management firm said first half of 2010 pre-tax profits soared 418.5% to £188.2 million compared with £36.3 million in the first half of 2009.

Smith & Nephew plc increased 1.30% to $45.12 after the medical technology company posted higher profit for the second quarter aided by strong underlying growth in its Endoscopy and Advanced Wound Management businesses.

Revenue in the second quarter rose 4% to $959 million from $926 million in the comparable period last year. Net profit increased 16% to $137 million or 15.4 cents per share from $118 million or 13.3 cents per share in the year-ago quarter.

Unilever plc plummeted 5.90% to €27.60 after the supplier of consumer goods said second-quarter profit attributable to shareholders'' equity surged 39.8% to €1.06 billion from €758 million a year-ago quarter. The company reported a 9.7% increase in turnover to €21.9 billion.