UK Inflation at 4%; UK Home Prices Rise; Barclays Surges 5%

Arthi Gupta
15 Feb, 2011
New York City

The UK indexes fell after the Bank of England Governor Mervyn King warned inflation likely to rise further and home prices rose. January inflation rose at twice the rate set by the central bank. UK Commercial Property acquired Leicester Retail Park. Barclays Plc net nearly triples.

[R]3:30 PM London – The UK indexes fell after the Bank of England Governor Mervyn King warned inflation likely to rise further and home prices rose. January inflation rose at twice the rate set by the central bank. UK Commercial Property acquired Leicester Retail Park. Barclays Plc net nearly triples.[/R]

In London, FTSE 100 Index declined 11.02 or 0.18% to 6,049.75 and the pound edged higher to close at $1.6132.

UK Annual Inflation Up, Home Prices Rise

Annual inflation rose to 4% in January from 3.7% in December, the Office for National Statistics said today. The annual rate reached the highest level since November 2008.

The latest data suggests inflation at twice the target set by the Bank of England.

UK inflation is likely to continue to pick up to somewhere between 4% and 5% over the next few months, Bank of England Governor Mervyn King said in his open letter to the Chancellor on Tuesday.

UK home prices rose 3.8% from the same period a year earlier to £208,150 in December, the Department of Communities and Local Government said on Tuesday. Home prices had risen 4% in November.

On a seasonally adjusted monthly basis, home prices advanced 0.5% in December, after a 0.3% increase in November.

UK Commercial Property Acquires Leicester Retail Park

UK Commercial Property Trust Ltd., managed by Ignis Real Estate, said it purchased St. George''s Retail Park, Leicester, from a fund managed by JP Morgan Asset Management for £49.9 million.

St. George''s Retail Park is an Open A1 retail park prominently located within Leicester city centre.

Spirent Communications Buys Fanfare

Spirent Communications plc agreed to buy privately held Fanfare Group, Inc., based in Mountain View, California, for a cash consideration of $15 million.

Fanfare is a provider of test automation solutions that help equipment manufacturers and service providers accelerate time to market and improve product quality in the face of rapidly growing complexity.

Gainers & Losers

Albemarle & Bond Holdings PLC gained 0.60% to 292.25 pence after the holding company reported revenue for the six months ended December 31 increased 24% to £48.81 million from £39.44 million last year. Profit for the period slipped 0.9% to £7.72 million or 13.89 pence per share from £7.79 million or 13.93 pence per share a year before.

Barclays Plc surged 5% to 326.25 pence after the banking firm reported fourth quarter pre-tax profit surged 274% to £1.79 billion from £478 million last year. Basic earnings per share for the latest quarter were 9.1 pence, significantly higher than 1.1 pence in the prior-year quarter.

Income for the fourth quarter of 2010 increased to £7.965 billion from £7.45 billion in the comparable period a year ago.

The British Land Company PLC edged higher 0.82% to 551.00 pence after the real estate investment trust reported third quarter profit slumped 58% to £261 million or 29.5 pence per share compared with £623 million or 72.2 pence per share a year ago.

Domino''s Pizza UK & IRL Plc slumped 4.02% to 502.00 pence after the franchisee of international fast food pizza delivery chain Domino''s Pizza stated full-year 2010 statutory pre-tax profit slid 14.1% to £35.2 million from £41.0 million last year. Group revenue grew 21.4% to £188.1 million from £155.0 million a year earlier.

InterContinental Hotels Group Plc fell 2.16% to 1,356.00 pence after the international hotel business reported fiscal year 2010 revenue improved 6% to $1.63 billion from $1.54 billion last year. Profit in the period rose 38% to $293 million or 99.0 cents per share from $213 million or 72.2 cents a share a year ago.

Further, the board has proposed a final dividend per ordinary share of 35.2 cents with the interim dividend per ordinary share of 12.8 cents.

Premier Foods plc surged 8.14% to 23.90 pence after the food producer released preliminary results for fiscal year 2010, reporting a loss for the year due to £125 million in impairment charge it took on Brookes Avana, its branded chilled ready meals business.

Revenues for the year declined 3.6% to £2.44 billion from £2.53 billion a year earlier. Loss in the period was £99.3 million or 4.1 pence per share compared to a profit of £25.2 million or 1.2 pence per share last year.