UK Home Prices Drop; AstraZeneca Profit Falls, Shell Sales Rise

Arthi Gupta
28 Oct, 2010
New York City

The UK indexes gained after high street sales rose and home prices fell more than expected in October. UBM priced $350 million bond offering. AstraZeneca net fell 27% as generic competition dragged performance. Shell earnings rose 7% as revenues grew on improving energy demand.

[R]4:10 PM London – The UK indexes gained after high street sales rose and home prices fell more than expected in October. UBM priced $350 million bond offering. AstraZeneca net fell 27% as generic competition dragged performance. Shell earnings rose 7% as revenues grew on improving energy demand.[/R]

In London, FTSE 100 Index traded higher 16.38 or 0.29% to 5,662.40 and the pound edged higher to close at $1.5928.

Ireland''s Prime Minister Brian Cowen said on Wednesday that public finance position still requires a major correction to put it on a sustainable path. He told Parliament that his government decided an overall budgetary adjustment of € 15 billion over the next four years in order to achieve the deficit target of 3% of GDP by 2014.

The downtrend in the UK property market continued in October, with major factors affecting house prices showing deterioration amid the fiscal squeeze, a report released by the Nationwide Building Society showed today.

The UK home prices fell 0.7% on a monthly basis in October, after staying flat in September, according to data from the Nationwide Building Society released today. Annually, home price inflation eased sharply to 1.4% in October from 3.1% in September. A typical property now costs £164,381 in Britain, the lowest since February 2010.

In another report, Land Registry said today that home prices in England and Wales recorded its smallest annual rise since December 2009. Home prices increased 5.2% in September from the previous year. This was the eleventh month in a row in which the annual figure remained above zero.

From August, home prices slipped 0.2%, which was the first negative figure seen for six months, bringing the average house price in England and Wales to £166,769.

According to survey data from the Confederation of British Industry published today that the UK retail sales increased for the fourth month in a row in October. Nearly 58% of retailers said the volume of sales rose in October, while 22% said it fell, giving a balance of plus 36%. The survey was conducted between September 28 and October 13, and covered 120 companies.

Looking to November, a balance of plus 43% of retailers expect a higher volume of sales than a year ago.

United Business Media Ltd. announced the pricing of an offering of $350 million of 5.75% 10-year Notes due November 3, 2020. The Notes were priced at 98.295% to yield 5.979%.

Plexus Holdings Plc, the oil and gas engineering services provider said it expanded its geographic reach to Australasia with Apache Energy Australia, a subsidiary of Apache Energy Ltd.

Essar Energy plc announced that the first phase of the expansion of its Vadinar power plant has been commissioned and started generating Power and Steam. Essar Energy plans to increase its operating capacity from 1,220 MW currently to 11,470 MW by the end of 2014.

The Vadinar power plant expansion is being implemented in two phases and, including the steam capacity, will increase the total installed capacity by 890 MW.

Gainers & Losers

Accenture Plc dropped 0.40% to $44.87 after the management consulting, technology services and outsourcing company said it signed an extension to its application outsourcing, systems integration and management consulting agreement with RSA for an additional three years through 2015.

Aggreko plc slumped 4.45% to 1,588.00 pence after the power and temperature control equipment lessor forecast a profit before tax of £300 million for fiscal 2010, after reporting a 30% growth in revenue for the three months ended September 30, 2010.

AstraZeneca Plc declined 1.39% to $50.22 after the biopharmaceutical company reported third quarter revenues fell 3.7% to $7.90 billion, from $8.20 billion in the prior year. Net profit in the quarter declined 27% to $1.55 billion, versus net profit of $2.12 billion in the previous year. Earnings per $0.25 ordinary share fell to $1.07 from $1.46 last year.

Development Securities PLC gained 2.13% to 240.00 pence after the company engaged in property development, investment and trading acquired a portfolio of 14 properties for £23.3 million from PricewaterhouseCoopers who are acting as administrators on behalf of Lloyds Banking Group.

Mouchel Group plc plunged 29.37% to 89.00 pence after the engineering consulting services provider said Richard Rae and Seamus Keating will join the board on November 4 as Non-Executive Directors.

Royal Dutch Shell plc gained 0.63% to 1,989.50 pence after the independent oil and gas company stated third quarter revenue increased 21% to $90.71 billion from $75.01 billion in the comparable period last year. Net income in the quarter rose 6.5% to $3.46 billion or 56 cents per diluted share, compared to net income of $3.25 billion or 53 cents per share a year ago.

Styles & Wood Group plc slumped 4.08% to 11.75 pence after the company engaged in providing property services in its statement on trading for the period from July 1, 2010 to October 27, 2010 said whilst trading conditions in its markets remain difficult it still expects to return the business to profit in this financial year. Therefore, revenue for the year ending December 31 is expected to be between £95 million and £100 million, with the improved margin experienced in first-half of 2010 expected to be maintained in the second-half of the year.