UK Home Loans Drop 18%; GDP Estimate Unrevised at 0.5%

Nigel Thomas
25 May, 2011
New York City

Stocks in London gained as miners and energy linked companies advanced. UK first quarter estimate was unrevised at 0.5%. Mortgage approvals dropped 18% from a year ago and average loan value declined 1.1%. Cupid soared nearly 20% after it made positive comments.

[R]4:30 London – Stocks in London gained as miners and energy linked companies advanced. UK first quarter estimate was unrevised at 0.5%. Mortgage approvals dropped 18% from a year ago and average loan value declined 1.1%. Cupid soared nearly 20% after it made positive comments.[/R]

The FTSE 100 index gained 11.73 to 5,870.14 and All-Share index added 3.76 to 3,058.92.

Market indexes in Europe declined but staged a turnaround in the early morning and closed higher.

CAC- 40 index increased 12.11 to 3,928.99, DAX 30 index 20.28 to 7,170.94 and the benchmark index in Madrid gained 101.50 to 10,217.40. The index in Milan added 1% to 20,815.73.

UK first quarter GDP rose 0.5% after falling 0.5% in the fourth quarter and gained 1.8% from a year ago.

The latest data released by the Office for National Statistics showed construction output fell by 4% and production output fell 0.2%. First quarter trade deficit in real terms decreased to £5.7 billion.

UK service sector index increased 1.0% in March from a year ago month. Between February and March output from the service sector rose 0.6%. The largest contribution to the increase was 1.0% in the business services and finance.

Total mortgage approvals dropped 18% in April to 29,335 from a year ago. The British Bankers Association also said average value of loans declined 1.1% from a year ago to £145,100.

Stock Movers

Of the stocks in the FTSE 100 index, ITV led the gainers with a rise of 2.5% to 69.80 pence followed by increase in Admiral Group of 2.4% to 1,688 pence and Barclays of 23% to 271.80 pence.

Of the stocks in FTSE 100 index, Next Plc led the decliners with a loss of 2.4% followed by losses in Burberry Group of 1.6% to 1,320 pence, in British American Tobacco of 1.4% to 2,681 pence.

Cupid increased 34 pence to 162.50 after the operator of dating flirt.com and benaughty.com guided higher trading conditions. The company said that online dating market in North America remains “exceptionally well” and growth in the overseas market is strong.

Cable & Wireless Communications plunged 10% of 5.59 pence to 42.41 pence after it reported flat earnings and guided no improvement in sales in Caribbean markets.

Hogg Robinson Group increased 1.3 pence to 59.25 pence after it reported 36% increased in annual profit. The travel services also hiked dividend by 25%.

Sports Direct International declined 5.5% to 215 pence and JJB Sports fell 11.4% or 3 pence to 23.25 pence after it reported losses in 2010 and said turnaround will take as many as five years.

The retailer reported pre-tax loss of £181.4 million on revenues of £362.9 million in the year ending in January 2011.

Quintain Estates closed higher 7.2% or 3.50 pence to 52 pence after it reported gross profit of £26.2 million and pre-tax loss of £48.1 million on valuation write-down in the first half.