UK Home Prices Decline; BAE Acquires Norkom for

Arthi Gupta
14 Jan, 2011
New York City

The UK indexes dropped as inflation increase and a private estimate suggested economic growth of 1.6% in 2010. Output price inflation increased and home prices declined in December. BAE Systems agreed to acquire Norkom for

[R]3:00 PM London – The UK indexes dropped as inflation increase and a private estimate suggested economic growth of 1.6% in 2010. Output price inflation increased and home prices declined in December. BAE Systems agreed to acquire Norkom for €217 million. Smith & Nephew denied merger speculations.[/R]

UK stocks were on the defensive after inflation rose at a faster pace in December and home prices fell in December.

The People's Bank of China on Friday raised banks' reserve requirement ratio by 50 basis points, the seventh hike since 2010. The last hike was on December 10. The central bank said new requirements will be effective from January 20.

In London, FTSE 100 Index declined 41.43 or 0.69% to 5,982.87 and the pound edged higher to close at $1.5849. For the week, the FTSE 100 Index fell 0.5%.

UK Economy Expands in 2010

The U.K. economy grew 1.6% in 2010, the National Institute of Economic and Social Research said.

The gross domestic product rose 0.5% sequentially during the three-month ending December, slightly slower than the 0.6% growth recorded during the September to November period, the institute said in its monthly GDP estimate.

UK Output Price Inflation Increases

UK output price annual inflation increased to 4.2% in December from an upwardly revised 4.1% in November, the Office for National Statistics said on Friday. On a monthly basis, the output price index climbed 0.5% in December, as against November's 0.4% increase.

Input price annual inflation accelerated to 12.5% in December from 9.2% in November.

UK Home Purchase Lending Remains Unchanged

The number of home purchase loans given in November was 44,000, unchanged from October, the Council of Mortgage Lenders said today. On an annual basis, it represented a fall of 15%.

UK Home Prices Fall

Average home prices in the UK recorded a marginal fall in December, according to data from LSL Property Services/ Acadametrics released today.

Home prices dropped 0.2% on a monthly comparison in December, the same rate of decline as seen in November and October. On an annual comparison, home prices increased 2.9% in December compared to 5.1% in November.

The number of transactions continued to fall as prices dropped steadily, the report showed. Transaction decreased 5% in December from November and 33% from December 2009.

BAE Systems Acquires Norkom

BAE Systems plc announced a deal to acquire financial crime and compliance solutions provider Norkom Group plc for approximately €217 million or about $290.69 million in cash.

Norkom, headquartered in Dublin, Ireland, provides solutions to counter financial crime in the financial services industry

ICON Buys Oxford Outcomes

ICON plc said that it acquired Oxford Outcomes, a global health outcomes consultancy and thereby announced the expansion of its Late Phase and Outcomes Research services through the acquisition.

Gainers & Losers

Berkeley Mineral Resources plc gained 0.83% to 6.10 pence after the company engaged in investing in tailings processing said that it appointed Mark Wainwright as non-executive director.

Bovis Homes Group Plc rose 1.83% to 433.00 pence after the home builder, in its trading update for the full year ended December 31, said it expects annual profit above current market consensus, helped by higher sales prices.

Flying Brands Ltd. plunged 13.79% to 46.12 pence after the multi-brand home shopping and collectables retailing company said like-for-like sales for the period were £5.0 million, compared to £5.7 million for last year.

Ideal Shopping Direct plc dropped 1.35% to 182.50 pence after the operator of home shopping television channel said sales, for the 52 weeks ended January 2 increased 13.5% compared to the previous year.

Smith & Nephew plc dipped 0.66% to 680.00 pence after the medical devices maker, in response to press speculation said it is not engaged in any discussions which could lead to a merger or company sale.

Spectris Plc surged 5.43% to 1,360.00 pence after the precision instruments maker, in a trading update for the year ended December 31 estimated revenues to increase about 15% from last year, helped by strong business recovery in the second half.