UK Indexes Drop 1.5%; Irish Inflation Soars

Arthi Gupta
20 Jan, 2011
New York City

The UK indexes declined the most in European trading after weak commodities prices. The UK manufacturing output estimated to improve and car production rose in 2010. Irish inflation soared in December. easyJet slumped 17% after first quarter revenue rose.

[R]3:45 PM London – The UK indexes declined the most in European trading after weak commodities prices. The UK manufacturing output estimated to improve and car production rose in 2010. Irish inflation soared in December. easyJet slumped 17% after first quarter revenue rose.[/R]

In London, FTSE 100 Index declined 88.24 or 1.48% to 5,888.46 and the pound edged lower to close at $1.5925.

The UK indexes declined the most in European trading as commodities declined on the worries that China may tighten more in the coming months after the GDP expanded sharply in the last quarter.

UK indexes are heavily dominated by energy and resource stocks and additional tightening in China could lower the demand of several metals and resources and lower prices.

UK Manufacturing Recovering

British manufacturing recovery is well on track on the back of export orders, but price pressures are mounting, the Confederation of British Industry said today.

Of the 394 manufacturers responded to the January quarter survey, 32% reported an increase in output over the past three months, while 16% saw a decrease. The resulting balance of 16% was higher than October quarter''s 9%.

UK car production picked up strongly in 2010 as exports boomed. Car makers manufactured 1.27 million cars, up 27.1% on the previous year, following a 10.6% increase to 94,325 cars in December, the Society of Motor Manufacturers and Traders said.

Commercial vehicle production in 2010 rose by 35.7% at 123,019 units, with a 19.4% rise in December to 8,682.

Irish Inflation Surges

Irish inflation accelerated to 1.3% in December from 0.6% in November, the Central Statistics Office said on Thursday.

On a monthly basis, consumer prices grew 0.2% in December, reversing a 0.1% drop in November.

Annually, costs of housing, water, electricity, gas and other fuels climbed 9.9% in December and transport charges rose 3.7%.

Xchanging Wins Contract from BAE Systems Surface Ships

Xchanging said that it received a contract with BAE Systems Surface Ships to develop Lean Six Sigma capability for the company but did not declare the size of the contract.

As part of the contract, Xchanging will offer training, development and coaching in Lean Six Sigma Process Excellence to the Naval Base Support Leadership Team, Project Champions and Team Leaders.

Gainers & Losers

Aberdeen Asset Management Plc plunged 4% to 216.00 pence after independent asset management company in its interim management statement for the first quarter ended December 31, said its assets under management increased 2.6% to £183.3 billion from £178.7 billion at September 30.

Associated British Foods Plc dropped 2.78% to 1,084.00 pence after the holding group said that its total revenues from continuing businesses for the 16 weeks to January 8 grew 10%, reflecting improved results in all of its business lines.

Draganfly Investments Ltd. slumped 5.41% to 1.40 pence after the investment trading and holding company reported profit for the six months ended October 31, 2010 was £0.03 million compared to loss of £0.19 million a year ago. Basic earnings per share were 0.03 pence versus basic loss per share of 0.16 pence prior year.

easyJet Plc slumped 16.92% to 378.70 pence after the discount airline reported revenue rose 7.5% to £654 million in the first quarter ended on December 31 from £608 million in the same period last year, despite severe weather and the Air Traffic Controllers'' strike in Spain and France.

The company also reported a 0.7% rise in passenger revenue per seat to £37.85 in the quarter, helped by strong capacity growth in Europe, good unit revenue growth in the UK and improvement in unit costs.

Going forward, easyJet expects a loss in the range of £140 million to £160 million for the first-half of the fiscal year, due to higher market price of jet fuel.

Galliford Try PLC gained 1.29% to 313.00 pence after the homebuilder said that in partnership with Imtech Process Ltd. it won a £33 million contract by Northumbrian Water to design and build an advanced anaerobic digestion plant.

Man Group Plc declined 3.42% to 291.00 pence after the asset manager in its interim management for the third quarter, said its assets under management increased from the sequential second quarter, helped by the acquisition of GLG Partners, Inc.

Funds under management as at December 31 were $68.6 billion, up from $40.5 billion at September 30. The acquisition of GLG added $25.4 billion of funds.

Publishing Technology PLC increased 2.94% to 52.50 pence after the provider of technology and supporting services said that it has a number of new projects.