UK Retail Sales Fall; Old Mutual Sells Nordic Business for

Arthi Gupta
15 Dec, 2011
New York City

The UK indexes advanced after retail sales volume declined and Ireland''s manufacturing price inflation eased in November. UK inflation expectations for the year ahead eased in November.

[R]4:00 PM London – The UK indexes advanced after retail sales volume declined and Ireland''s manufacturing price inflation eased in November. UK inflation expectations for the year ahead eased in November.[/R]

The UK indexes advanced in cautious trading and in Europe and in New York.

Britons'' inflation expectations for the year ahead eased to 4.1% in November from 4.2% in August, a survey by the Bank of England and GfK NOP showed.

The quarterly survey of public attitudes to inflation was undertaken in November 2011. Inflation for the longer-term, say in five years time is seen at 3.5%, unchanged from August.

In London, FTSE 100 Index gained 44.07 or 0.8% to 5,409.93 and the pound edged higher to $1.5513.

Investors were hopeful that external funding will bolster the emergency fund to stabilize the euro and Russia said it could offer $20 billion to IMF to manage future bailouts in the region.

Arkady Dvorkovich, an economic aid to Russian President Dmitri Medvedev said in Brussels that Russia is willing to assign $10 billion that is due from the International Monetary Fund from its commitment in 2009.

Russia is also considering providing a separate loan of $10 billion to the emergency fund under certain conditions.

However, European Central Bank President Mario Draghi said at a speech today that struggling nations should focus on resolving their problems on their own rather than relying on financing from a central bank or other external sources.

He added at the speech in Berlin after the completion of Spanish Treasury auction, “There is no external savior for a country that doesn’t want to save itself.”

UK Retail Sales Fall

The UK retail sales volume including auto fuel declined 0.4% in November from a month ago, reversing a revised 1% rise in October, data from the Office for National Statistics showed today.

On a yearly basis, sales advanced 0.7 in November.

Food store sales dropped 0.6% annually and non-food store sales declined 0.7% in November.

Separately, UK manufacturers expect production to decline over the coming quarter as their total order books weakened further in December, the latest Industrial Trends survey from the Confederation of British Industry showed.

The survey showed that 18% of respondents reported total order books to be above normal, while 41% said that they were below. The resulting balance of -23% was the lowest since October 2010. The expected balance was -20%.

The survey was conducted between November 24 and December 7.

Irish Output Price Inflation Eases, Surplus Falls

Ireland''s manufacturing output price inflation weakened in November, data released by the Central Statistics Office showed Thursday.

The output price index for the Irish manufacturing sector increased 1.9% from a year ago in November, following the 2.5% growth in October.

On a monthly basis, output prices advanced 0.9% in November, from the 0.3% decrease in October.

In another report, Ireland''s merchandise trade surplus decreased from last year in October, data released by the Central Statistics Office showed.

The trade surplus declined 6% on an annual basis to €3.64 billion in October as against a surplus of €4.37 billion in September.

Old Mutual Sells Nordic Business

Old Mutual plc announced that it intends to divest its Nordic business, Skandia Insurance Company Ltd, comprising Old Mutual''s long-term savings and banking operations in Sweden, Denmark and Norway operating under the Skandia brand, to Skandia Liv for SEK22.5 billion or £2.1 billion.

The company intends to use the proceeds of the transaction to reduce group debt and to return surplus capital to shareholders in due course.

Gainers & Losers

Cohort Plc surged 10.4% to 101 pence after the technology company said first half revenue increased 14% to £37.4 million from £32.7 million last year.

Greenko Group plc soared 6.6% to 137 pence after the holding company reported first-half revenue fell 23.3% to €19.8 million from €25.81 million in the same period last year. Pre-tax profit in the period slumped 66.2% to €3.09 million versus €9.14 million last year.

John Wood Group PLC fell 2% to 623.50 pence after the energy services company expects to deliver 2011 performance in line with expectations and also anticipates growth in all divisions in 2012.

Moss Bros Group Plc gained 0.8% to 32.50 pence after the menswear stores stated like-for-like sales for the first 19 weeks of the second-half rose 10.5% up on last year. Like for like sales for the 45 weeks to December 10 were 13.4% from a year ago period. Total sales for the 45 weeks to December 10 were 18.5% ahead of last year.

Sports Direct International Plc plunged 5.2% to 189.20 pence after the retailing group reported first-half group revenue rose 8.4% to £888.64 million from £819.89 million the prior year. Profit for the period climbed 3.2% to £71.30 million or 11.80 pence per share compared to £69.09 million or 11.43 pence per share a year earlier.