FTSE Falls 1%; Construction Activity Slows, Mortgage Approvals Up

Arthi Gupta
04 May, 2011
New York City

The UK indexes slid after shop prices rose and construction activity slowed in April. M4 money supply dropped and mortgage approvals increased in March. Logica surged 3.7% on quarterly revenue growth.

[R]2:00 PM London – The UK indexes slid after shop prices rose and construction activity slowed in April. M4 money supply dropped and mortgage approvals increased in March. Logica surged 3.7% on quarterly revenue growth.[/R]

In London, FTSE 100 Index declined 66.27 or 1.05% to 6,013.56 and the pound edged higher to close at $1.6540.

UK Shop Prices Rise

An index measuring shop prices in the United Kingdom increased 2.5% on year in April, following the 2.4% annual expansion in March, the British Retail Consortium said on Wednesday.

The rise was fueled by surging food prices, which climbed 4.7% on year in April after increasing 4.0% in March. Non-food prices slowed to 1.2% on year in April from 1.5% in March.

UK Construction Activity Slows

Construction activity in the UK slowed more than expected in April as housing construction contracted for the first time this year, survey by Markit Economics showed on Wednesday.

The seasonally adjusted Markit/Chartered Institute of Purchasing & Supply purchasing managers'' index for the construction sector slipped to 53.3 in April from 56.4 in March.

UK M4 Money Supply Drops

UK broad money aggregate M4 declined for the sixth consecutive month in March, data from Bank of England showed.

M4, which is a measure of the quantity of UK money supply, dropped a seasonally adjusted 1.1% annually in March, following a revised 1.4% decline in February.

On a monthly basis, M4 money supply edged up a seasonally adjusted 0.1% in March, after decreasing 0.3% in February.

UK Mortgage Approvals Increase

The number of loans approved for home purchase in the U.K. increased to 47,557 in March from 46,708 in February, the Bank of England said in a report on Wednesday.

Total lending to individuals rose £0.5 billion in March, compared to the £1.7 billion growth reported in February.

England/Wales Home Prices Fall

Home prices in England and Wales decreased at a faster pace in March, data released by Land Registry showed today.

The home price index declined 2.3% annually in March, faster than February''s 1.3% fall. Prices decreased for the third straight month in March.

On a monthly-basis, home prices dropped 1.1% in March, which was the biggest monthly decline since February 2009.

The average home price declined to £160,996 in March from £162,831 in February.

Gainers & Losers

JD Wetherspoon Plc declined 1.32% to 448.00 pence after the British pub chain operator said like-for-like sales for the 13 weeks to April 24 increased 2.4%. Total company sales over the same period increased 7.4%.

Legal & General Group plc dropped 2.42% to 120.80 pence after the provider of risk, savings and investment management products said its first quarter worldwide sales grew 12% to £433 million from last year''s £388 million.

Logica plc surged 3.69% to 140.60 pence after the business and technology service company said first quarter revenues rose 4.2% to £978 million, from £939 million last year.

Ryanair Holdings PLC fell 0.35% to €3.39 after the Europe''s largest discount carrier reported April passengers rose 10% to 6.8 million, from 6.2 million last year. Load factor increased 2% to 85% from 83% in the prior-year period.

Standard Chartered Plc slumped 2.70% to 1,620.50 pence after the lender stated that it saw double-digit income growth in the first quarter compared with the prior-year period, with good momentum in both consumer and wholesale banking businesses.