UK Index Advances 1.3%; TUI Travel, Imperial Tobacco Rise

Nigel Thomas
10 May, 2011
New York City

UK stocks climbed tracking the gains in European markets. UK retail sales volume increased 5.2% in April largely on the account of calendar shift and one-time event. Intercontinental Hotels Group guided higher sales at Holiday Inn and Imperial Tobacco Group reported higher sales.

[R]4:45 PM London – UK stocks climbed tracking the gains in European markets. UK retail sales volume increased 5.2% in April largely on the account of calendar shift and one-time event. Intercontinental Hotels Group guided higher sales at Holiday Inn and Imperial Tobacco Group reported higher sales.[/R]

UK stocks extended gains after Greece completed its debt offering and attracted more than one third investors from overseas.

The debt auction of €1.26 billion also dragged the yield on Greek bonds lower by a fraction but investors remained jittery and focused on the possible restructuring of the bonds.

In addition, the IMF is expected to announce a new bailout of as much as €80 billion with a different set of conditions that will cover the Greece’s needs of refinancing through 2013.

FTSE 100 index increased 76.20 to 6,018.89 and FTSE All Share index added 39.59 to 3,133.73.

The pound closed lower to $1.6329.

UK retail sales volume on a comparable basis increased 5.2% in April from a year ago when sales declined 2.3% Total sales in the month increased 6.9% against 0.2% decline in the month a year ago.

The calendar shift for Easter Holiday also played a key role in the sales in the months. Combine sales for two months to April were flat when compared to a year ago period, according to British Retail Consortium.

Stock Movers

Among the most active stocks, Schroders led with a rise of 5.6% to 1,750 pence followed by Intercontinental Hotels Group with a gain of 3.9% to 1,298 pence and Sage Group added 3.6% to 296 pence.

Among the most active stocks, BG Group led the decliners with a loss of 1.6% to 1,412 pence followed by a loss of 0.4% in Resolution Ltd to 296.30 pence, Vodafone Group fell 0.3% to 169.60 pence and GlaxoSmithKline dropped 0.1% to 1,302 pence.

Pace declined as much as 40% to 93.00 pence after the company guided lower earnings for the year between $150 million and $170 million.

Intercontinental Hotels Group gained nearly 4% after the company guided sales at its U.S. based Holiday Inn to increase to $396 million from $362 million and pre-tax profit to rise before exceptional items to $96 million from $68 million.

Imperial Tobacco Group increased 67 pence to 2,224 pence after the company posted better than expected earnings in the first half to March on higher sales in emerging markets.

Morgan Crucible Co increased 15 pence to 329 pence after it guided higher earnings for the full year.

TUI Travel increased 4.40 pence to 248 pence after first half loss narrowed to £364 million from £375 million on sales increase of 5% to £5.2 billion.