Irish CPI Rises; Man Group, Rolls-Royce Deals

Arthi Gupta
14 Oct, 2010
New York City

The UK indexes fell after a weak rally by banking stocks. The BoE policy committee member Sentance urged for withdrawal of monetary stimulus. Irish CPI rose in September. Man Group completed $1.6 billion GLG buyout deal. Rolls-Royce won $390 million order from Thai Airways.

[R]4:00 PM London – The UK indexes fell after a weak rally by banking stocks. The BoE policy committee member Sentance urged for withdrawal of monetary stimulus. Irish CPI rose in September. Man Group completed $1.6 billion GLG buyout deal. Rolls-Royce won $390 million order from Thai Airways.[/R]

In London, FTSE 100 Index traded lower 28.41 or 0.49% to 5,718.94 and the pound edged higher to close at $1.5980.

The Bank of England should now start gradual adjustment of monetary policy in line with economic developments, policy maker Andrew Sentance said on Wednesday. ""The improvement we have seen in the economy over the last year and the above-target inflation we have experienced point to the need to begin the process of withdrawing the very substantial level of monetary stimulus,"" he said in a speech to the British American Business Council.

Sentance, who has repeatedly sought interest rate hikes, believes that a gradual exit from loose monetary policy should not be a threat to the recovery, but it is the key to sustaining the recovery.

Irish annual consumer price inflation increased in September, according to a report released by the Central Statistics Office today.

The consumer price index grew 0.5% annually in September, compared to a 0.2% rise in August. Consumer prices increased for the second straight month since December 2008. A year earlier, prices slipped 6.5%. Food and non-alcoholic beverages prices fell 2% annually in September, while clothing and footwear prices dropped 7.4%.

On a monthly basis, the CPI dropped 0.1% in September, compared to a 0.7% rise in August. Food and non-alcoholic beverages prices fell 0.2%, while clothing and footwear prices grew 4.5% in September.

Man Group plc, the hedge fund manager completed the acquisition of GLG Partners, Inc. for $1.6 billion to create an alternative investment manager with around $63 billion of funds under management. Man Group said GLG is now its wholly owned subsidiary.

Man Group also issued an aggregate of 162.73 million of its new shares in connection with the proposed acquisition to the GLG Exchange Stockholders.

Rolls-Royce won an order worth $390 million at list prices from THAI Airways International for Trent 700 engines to power an additional seven Airbus A330 aircraft. The order includes a TotalCare long-term service deal for the aircraft which would be delivered from 2011.

Gainers & Losers

Allied Irish Banks, plc fell 2.33% to $1.26 after the lender completed a public offering in the United States of contingent mandatory exchangeable notes exchangeable for shares of M&T Bank Corporation.

Ashmore Group plc surged 5.03% to 379.90 pence after the investment manager in its interim management statement for the period ended September 30 reported 18% growth in assets under management to $41.6 billion, compared to $35.3 billion recorded in June quarter 2010, owing to the net inflows of $3.4 billion and positive performance of $2.9 billion.

Booker Group plc soared 6.65% to 53.05 pence after the food wholesaler reported first-half total sales rose 5.6% to £1.70 billion from £1.61 billion in the previous-year period, driven mainly by a 35.4% increase in Internet sales and like-for-like sales grew 5.3%. Profit before tax in the first half rose 24.2% to £36.9 million from £29.7 million in the same period last year.

Crimson Tide plc plunged 7.69% to 1.20 pence after the company engaged in provision of mobile data solutions, software and related activities said that it raised £550,000 by placing 55 million new ordinary shares at price 1 pence each.

The company intends to use the proceeds from the placing for expansion and working capital purposes, specifically to finance anticipated subscription contracts.

Diageo Plc dropped 0.96% to 1,132.00 pence after the beverages company said its first quarter performance is in line with its expectations and it saw a 5% organic growth in net sales for the first quarter, reflecting good volume growth.

The maker of Smirnoff vodka, Johnnie Walker whiskey and Guinness beer posted net sales of £2.063 billion for the first quarter, higher than £1.946 billion in the same quarter last year.

Sirius Petroleum Plc gained 1.33% to 9.12 pence after the oil product trading activities company posted wider loss for the five months ended June 30, 2010, affected by higher administrative expenses.

Loss before and after taxation and retained loss attributable to equity holders of the company widened 141% to $0.82 million from $0.34 million last year. Loss per share also widened to $0.16 from $0.07 year ago.

WH Smith PLC increased 5.60% to 480.50 pence after the newspaper and stationery retailer announced preliminary results for the fiscal year 2010. Annual revenues declined 2% to £1.31 billion from £1.34 billion reported in the preceding year and like-for-like sales were down 4%.

Profit for the year rose 9.5% to £69 million or 45.7 pence per share, compared to a profit of £63 million or 40.6 pence per share in the prior year.