UK Indexes Higher; Marks & Spencer Falls 2.4%

Arthi Gupta
11 Jan, 2011
New York City

The UK indexes edged higher after retail sales fell in December and tracking market gains in Europe. Japan and China expressed their willingness to participate in a euro-bond offering that will support Portugal and Ireland. Hamworthy secured Brazilian contract for

[R]3:30 PM London – The UK indexes edged higher after retail sales fell in December and tracking market gains in Europe. Japan and China expressed their willingness to participate in a euro-bond offering that will support Portugal and Ireland. Hamworthy secured Brazilian contract for £30 million.[/R]

Rising concerns about the looming European debt crisis increased the threat of a spill-over to the UK and other large European banks, though the risks have been limited so far, the Bank of England Executive Director for Banking and Chief Cashier Andrew Bailey said on Monday.

In a speech in Edinburgh, Bailey said that over the last twelve months, concerns with both sovereign states and their banking systems have intensified in other parts of Europe.

Japan’s Finance Minister Yoshihiko Noda said his country is planning to buy bonds issued by the European Financial Stability Facility. Noda said Japan is contemplating “buying more than 20% of the amount"" of EFSF securities to be issued in the initial round.

In London, FTSE 100 Index gained 71.67 or 1.18% to 6.027.97 and the pound edged lower to close at $1.5551.

UK Retail Sales Fall

Retail sales in the United Kingdom declined 0.3% annually in December, following a 0.7% increase in November, the British Retail Consortium said on Tuesday, due to exceptionally snowy weather. This marks the first decline in seven months.

For the fourth quarter of 2010, food sales rose an annual 2.1% and non-food sales fell 0.8%. Overall, sales for the quarter rose an annual 0.4%.

UK Economic Recovery Slows

The UK recovery slowed down in the final quarter of 2010 on the back of weakness in the service sector, a new survey suggested on Tuesday.

The British Chambers of Commerce''s latest quarterly survey, covering over 5,600 business across UK, suggested the economy grew only 0.4% to 0.5% in the December quarter.

Simon Property Drops Bid for CSC

Simon Property Group, Inc., the shopping mall operator said it continues to oppose the proposed acquisition by CSC of the Trafford Centre, and abandoned its nearly £3 billion bid for UK-based real estate investment trust Capital Shopping Centres Group plc.

Simon said it has no plan to make a formal offer for CSC, as the company will not give access to its accounts.

RBS Reaches Settlement with FSA

Royal Bank of Scotland Group plc said that it reached a settlement with the Financial Services Authority following the completion of an investigation into RBS and NatWest''s retail branch banking complaint handling procedures. RBS Group will pay a fine of £2.8 million.

Hamworthy Wins Brazilian Contract

Hamworthy PLC said it won a contract from Brazilian shipyard Engevix Construcões Oceânicas S.A. for the supply of cargo pumping systems for eight Floating Production Storage and Offloading vessels.

According to the company, the contract is worth about £30 million and the equipment is scheduled to be delivered between 2012 and 2014.

Innovation Group Subsidiary Acquires Stake in TJH

Innovation Group PLC, a provider of business process outsourcing and software solutions said that its South African subsidiary, Innovation Group Pty Ltd, acquired a 70% stake in TJH Financial Services Pty Ltd. for a total cash consideration of ZAR10.56 million.

The acquisition broadens the policy and underwriting administration services available to the clients.

Logica-led Consortium Wins Contract from SOCA

The i2d consortium led by Logica has been awarded a £157 million worth 10 year outsourcing contract to deliver the Serious Organised Crime Agency’s ICT and related services. Logica will deliver the contract with its key partners in the successful i2d consortium of QinetiQ, Detica and Cable & Wireless.

Gainers & Losers

BAE Systems plc fell 0.32% to 339.30 pence after the defense, security and aerospace company said it is no longer seeking to sell Platform Solutions business.

BP plc edged lower 0.11% to $46.03 said that the Rumaila Operating Organisation achieved a major milestone in the re-development of the super-giant field in Southern Iraq. The milestone was met by increasing production by more than 10% above the 1.066 million barrels a day initial production rate agreed in December 2009.

Charlemagne Capital Limited gained 2.13% to 24.00 pence after the independent specialist asset manager said that total revenue for fiscal year 2010 rose 18.9% to $28.3 million from $23.8 million last year.

Compass Group PLC climbed 0.79% to 571.50 pence after the company that provides foodservice and support services announced acquisition of Küchenbetrieb Menke - Bremer Betriebsverpflegung GmbH & Co. KG, Menke Cateringkonzepte GmbH & Co. KG and Menü-Dienst Nolting GmbH & Co. KG for an aggregate cash consideration of up to €4.8 million.

London Capital Group Holdings plc declined 0.92% to 108.00 pence after the financial services companies in its trading update, said that its full-year 2010 profit before tax, excluding share based payment expense is in line with current market expectations. The group added that this profit figure is before a previously announced exceptional impairment of capitalized software costs of £3.2 million.

Marks & Spencer Group Plc decreased 2.40% to 374.80 pence after the British retailer reported its total sales for the third quarter increased 4%, helped by strong results in the UK general merchandise and food segments.

MTI Wireless Edge Limited surged 15.56% to 13.00 pence after the developer and manufacturer of antennas and antenna systems said that revenue in the fourth quarter ended December 31, 2010, increased to $3.8 million an increase of 20% from a year ago.

Rio Tinto Plc climbed 1.18% to 4,441.00 pence after the Anglo-Australian miner said it sent its first bidder''s statement to Australian coking coal miner Riversdale Mining Ltd. shareholders, related to the takeover bid by Rio Tinto Jersey Holdings 2010 Ltd., a unit of Rio Tinto, for all the ordinary shares in Riversdale for A$16 per share in cash.

Sinclair Pharma Plc advanced 1.23% to 41.00 pence after the specialty pharmaceutical company stated that revenues for the half year ended in December 2010 soared 25% to £13.9 million from £11.0 million.

Standard Life plc rose 1.50% to 217.00 pence after the long-term savings and investments business said that all conditions of Focus Solutions Group offer have now been satisfied or waived. Accordingly, the offer in now declared wholly unconditional.

On December 7, 2010, the boards of Standard Life plc and Focus Solutions Group plc announced they reached agreement on the terms of a cash offer from Standard Life.

The British Land Company Plc gained 0.38% to 527.50 pence after the real estate investment trust entered into an agreement with The Portman Estate to purchase and redevelop Marble Arch House, W1 for £18 million.