UK Mortgage Approvals at 4-Month Low; Manufacturing Index Falls

Arthi Gupta
01 Jun, 2011
New York City

The UK mortgage approvals fell, gross lending improved and M4 money supply declined in April. Manufacturing index fell more than estimated in May. Kennedy Wilson Holdings surged 4.1% after acquisition of Bank of Ireland Real Estate Investment Management.

[R]3:20 PM London – The UK mortgage approvals fell, gross lending improved and M4 money supply declined in April. Manufacturing index fell more than estimated in May. Kennedy Wilson Holdings surged 4.1% after acquisition of Bank of Ireland Real Estate Investment Management.[/R]

The OECD area economy expanded at a steady pace in the first quarter, the Organization for Economic Cooperation and Development said. The UK economy expanded 0.5% in the first quarter, reversing a similar size contraction in the previous quarter.

In London, FTSE 100 Index declined 14.94 or 0.25% to 5,975.10 and the pound edged lower to close at $1.6429.

UK Mortgage Approvals Decline

The number of loans approved for home purchase in the UK dropped to 45,166 in April from 47,145 in March, the Bank of England said in a report on Wednesday.

Total lending to individuals rose £1.2 billion in April compared to the £1.1 billion growth reported in March. Lending secured on dwellings rose £0.7 billion in April compared to £0.5 billion increase in March.

UK Gross Lending Improves

Lending activity by mutuals in the UK continued to improve in April, the Building Societies Association said.

Gross lending by British mutuals increased 19% annually to £1.62 billion in April and net lending dropped to £462 million from £994 million last year.

At the same time, mortgage approvals by mutuals increased 14% annually to £1.73 billion during the month.

UK M4 Money Supply Drops

UK broad money aggregate M4 dropped a seasonally adjusted 0.9% annually in April, following a 1.1% fall in March, data from Bank of England showed.

On a monthly basis, M4 money supply increased a seasonally adjusted 0.1% in April, matching March''s gain. It was the second monthly increase in a row.

UK Manufacturing PMI Falls

In the UK, the seasonally adjusted Markit/Chartered Institute of Purchasing & Supply Purchasing Managers'' Index fell more than expected to 52.1 in May from a downwardly revised 54.4 in April.

Gainers & Losers

Intermediate Capital Group Plc fell 1.28% to 340.20 pence after the provider of mezzanine and equity finance reported fiscal year 2011 profit before tax surged 76% to £186.3 million from £105.8 million in the previous year.

Total income for the year improved 3.2% to £438.7 million from £424.9 million a year ago.

Kennedy Wilson Holdings Inc. surged 4.07% to $11.50 after the diversified, international real estate company announced its foray into Ireland and Europe through the acquisition of Bank of Ireland Real Estate Investment Management, which manages about €1.6 million, or $2.3 billion, worth of real estate assets.

Northumbrian Water Group Plc fell 0.66% to 360.30 pence after the provider of water and waste water services reported revenue for fiscal year 2011 rose 4.7% to £738.1 million from £704.7 million with a 4.8% growth at its principal subsidiary Northumbrian Water Limited.

Profit for the year increased 45.6% to £178.3 million or 34.38 pence per share from £122.5 million or 23.62 pence per share in the prior year.

SIG plc declined 1.12% to 150.50 pence after the supplier of insulation, exteriors, interiors and specialist construction products announced the sale of its Safety and Workwear business to Bunzl plc.

Wolseley Plc climbed 0.24% to 2,063.00 pence after the plumbing and heating products company reported third quarter total revenue edged up 0.6% to £3.27 billion from £3.25 billion a year ago. Like-for-like revenue, excluding the effect of currency exchange, acquisitions and disposals, improved 6%.