UK Jobless Claims Soar, Unemployment Rate at 7.9%

Arthi Gupta
17 Aug, 2011
New York City

The UK indexes edged lower after jobless claims rose in July and unemployment rate soared to 7.9% in the three months to June. The BoE minutes showed consensus among members on maintaining interest rate at a historic low of 0.5%. Balfour Beatty plunged 4.9% on weak first-half revenue.

[R]3:45 PM London – The UK indexes edged lower after jobless claims rose in July and unemployment rate soared to 7.9% in the three months to June. The BoE minutes showed consensus among members on maintaining interest rate at a historic low of 0.5%. Balfour Beatty plunged 4.9% on weak first-half revenue.[/R]

The Bank of England decided to leave its key rate unchanged at a historic low of 0.5% by a unanimous vote in August, the minutes of the two-day meeting ending on August 4 showed today.

However, the committee member Adam Posen sought an increase in the size of the asset purchase program by £50 billion to a total of £250 billion.

Ireland''s Minister for Finance Michael Noonan told RTE''s Morning Ireland that there would be dissent among other European nations for the financial transaction tax as proposed by German and French leaders in a meeting yesterday.

Noonan hinted that Ireland would see to it that any such tax is applicable to all member nations of the European Union, instead of applying it alone on 17 euro area countries.

In London, FTSE 100 Index gained 1.43 or 0.02% to 5,359.17 and the pound edged higher to $1.6557.

UK Jobless Claims Soar

The number of people claiming jobseeker''s allowance in the UK increased 37,100 in July from June, the Office for National Statistics said today. The monthly claimant count change for June was revised up to 31,300 from 24,500.

The claimant count rate was 4.9% in July, up 0.1 percentage point from June and up 0.3 percentage points from a year earlier.

The total number of unemployed people increased 38,000 to 2.49 million and the jobless rate soared to 7.9% in the three months to June.

Gainers & Losers

Balfour Beatty Plc plunged 4.87% to 250.10 pence after the infrastructure group reported first-half Group revenue declined 2% to £4.51 billion from £4.61 billion in the same period last year. Profit before tax for the period declined 9% to £91 million from £100 million in the previous year.

Flybe Group plc declined 1.90% to 155 pence after the low-cost regional airline said first quarter total revenue rose 8.3% to £160.4 million, from £148.1 million last year. Passenger revenue rose 12.2% to £150.6 million from £134.2 million in the prior-year quarter.

Hikma Pharmaceuticals PLC dipped 0.75% to 665 pence after the pharmaceutical company said that its wholly-owned subsidiary Hikma Pharmaceuticals Ltd. entered into a licensing and distribution agreement with Vifor Pharma, a wholly-owned subsidiary of Galenica Group.

Under the agreement, Hikma will market Ferinject, Vifor Pharma''s innovative treatment for iron deficiency, in the Middle East and North African region.

Henderson Group plc slumped 3.03% to 137.70 pence after the investment management company said first-half pre-tax loss was £3.1 million compared with a profit of £41.6 million a year earlier.

SABMiller Plc gained 1.32% to 2,146 pence after the brewer said it will take its A$4.90 per share cash takeover offer for Australia based Foster''s Group Ltd.''s directly to shareholders.

Foster''s earlier rejected the unsolicited and conditional offer of A$4.90 per share or A$9.51 billion or about $9.97 billion on June 21 stating it significantly undervalues the company.