UK Indexes Decline; BHP Billiton, Rolls Royce, Gartmore Fall

Nigel Thomas
08 Nov, 2010
New York City

Stocks in London declined as commodities prices gained and the dollar edged higher against the euro but declined to the pound. Gartmore Group Ltd plunged after star managers leave the company and the management seeks a buyout candidate. Banks close lower.

[R]5:30 PM London – Stocks in London declined as commodities prices gained and the dollar edged higher against the euro but declined to the pound. Gartmore Group Ltd plunged after star managers leave the company and the management seeks a buyout candidate. Banks close lower.[/R]

European markets fluctuated after a week of solid gains. Major markets in the region closed lower but markets in Greece closed higher after Prime Minister Gorge Papandreou controlled party is ahead in local elections.

DAX Index declined 3.70 to 6,750.50, CAC 40 index declined 1.75 to 3,914.98 and FTSE 100 Index dropped 26.97 to 5,848.38. One UK pound fetched $1.61.

German industrial production declined 0.8% in September from August when the index rose 1.5% according to Economy Ministry in Berlin.

The euro in Frankfurt and London trading declined on the worries that Ireland may struggle to bridge its soaring budget deficit. The euro declined 0.7% against the dollar to $1.389 and spread between the yields on the Irish debt and German debt soared to 520 basis points.

Stocks on the Move

Gartmore Group Ltd dropped 18.5% to 102 pence after the recently listed money manager said its Chief Investment Officer Dominic Rossi has left for another fund manager and a manager of large cap stocks Roger Guy has retired. The company also said it has put in place stock incentive program and has appointed Goldman Sachs to look for a merger candidate.

Banks in UK declined after Germany based Commerzbank reported lower than expected third quarter earnings. Royal Bank of Scotland declined 3.4% to 43.50 pence.

BHP Billiton declined more than 1% to 2,423 on the speculation that the company may acquire the stake controlled by Royal Dutch Shell Plc in Australia based Woodside Petroleum.

Rolls Royce Group declined 1% after it confirmed that recent A380 engine failure on Qantas flight was linked to Trent 900 engine and it is specific to that engine.