UK Shop Price Inflation Rises; Henderson Acquires Gartmore

Arthi Gupta
12 Jan, 2011
New York City

The UK indexes climbed after euro area sovereign debt concerns eased with the successful bond auction in Portugal. The UK retail price inflation rose and trade deficit widened. Irish consumer confidence fell in December. Henderson agreed to buy Gartmore for $525 million.

[R]3:30 PM London – The UK indexes climbed after euro area sovereign debt concerns eased with the successful bond auction in Portugal. The UK retail price inflation rose and trade deficit widened. Irish consumer confidence fell in December. Henderson agreed to buy Gartmore for $525 million.[/R]

The Portuguese government sold €1.25 billion, or approximately $1.6 billion, in notes scheduled to mature between 2014 and 2020.

Portugal sold €599 million of 10-year bonds due in 2020 at an average yield of 6.72%, as against the 6.81% at the previous sale on November 10. However, the €650 million of bonds maturing in 2014 were sold for an average yield of 5.4%, compared with 4.04% in October.

In London, FTSE 100 Index gained 15.01 or 0.24% to 6,028.51 and the pound edged higher to close at $1.5602.

UK Shop Price Inflation Rises, Trade Deficit Widens

Retail price inflation in the UK rose 2.1% annually in December, compared to a 2% increase in November, reports said citing the British Retail Consortium.

Non-food inflation rose to 1.1% in December from 0.9% in November, while food inflation stayed at 4%.

The UK''s seasonally adjusted deficit on trade in goods was £8.7 billion in November compared with the deficit of £8.6 billion in October, data from the Office for National Statistics showed today.

Total exports rose 4.1% to £23.6 billion and total imports advanced 3.4% to £32.4 billion.

UK Recruitment Grows

UK job placements continued to rise in December, albeit at a slightly weaker pace than in November, a fresh survey suggested on Wednesday.

The Recruitment and Employment Confederation-KPMG Report on Jobs said demand for staff continued to rise at a solid pace in December.

Permanent staff vacancies increased at the sharpest rate in four months, while growth of temporary vacancies accelerated to a six-month high.

Irish Consumer Morale Dips

Confidence among Irish consumers declined sharply in December, according to a survey by KBC Ireland and the Economic and Social Research Institute.

The consumer sentiment index slipped to 44.4 in December from 48.4 in November.

Henderson Acquires Gartmore

Henderson Group plc, the UK-based investment management firm announced an all-stock deal to acquire alternative asset management firm Gartmore Group Ltd. for about £335.3 million or about $525 million. The acquisition is expected to be completed in three months.

Gainers & Losers

Galliford Try plc fell 0.16% to 315.50 pence after the home builder said it received three regeneration projects worth £29.9 million through the Homes and Community Agency''s Delivery Partner Panel across all three of its regional clusters.

Petra Diamonds Limited surged 7.83% to 155.00 pence after the independent diamond mining company said that gross mine revenue for the six months ended December 31, 2010, rose 44% to $90 million, mainly attributable to increased production from the Cullinan, Kimberley Underground and Koffiefontein mines, coupled with stronger prices achieved for the period due to the sustained recovery in the rough diamond market.

J. Sainsbury plc declined 1.66% to 383.90 pence after the retailer reported increases in total sales and comparable sales for the third quarter. The retailer said sales during the Christmas were the “best-ever,” despite challenging weather conditions. The company also issued an optimistic full-year outlook.

In a trading statement for the third quarter, the company said total sales rose 7.5% from last year and comparable sales rose 5.4%.

The company added about 700,000 square feet of new space in the quarter and nearly 6,000 new jobs were created.

Stagecoach Group PLC decreased 1.42% to 215.80 pence after the international public transportation company, announced plans to buy and lease a total of more than 520 new buses and coaches for its operations across the UK in the current year and in 2012.

The transport group is investing £52 million in 360 new buses and coaches for the next financial year.

SuperGroup Plc soared 18.73% to 1,382.00 pence after the fashion retailer reported that its total sales for the nine-week Christmas trading period to January 2 climbed 90.1% to £65.1 million from last year.

UK Mail Group plc plunged 6.34% to 310.00 pence after the parcel delivery company in its interim management statement said that it now expects profit for the full year “to be below previous expectations and broadly in line with last year.”