UK Construction Climbs, Factory Gate Inflation Eases

Arthi Gupta
13 Jan, 2012
New York City

The UK indexes pared gains after early advances. Construction output rose but factory gate inflation eased in December. Invensys slumped 21% after weak fiscal year 2011 outlook.

[R]2:40 PM London – The UK indexes pared gains after early advances. Construction output rose but factory gate inflation eased in December. Invensys slumped 21% after weak fiscal year 2011 outlook.[/R]

The UK indexes pared gains after JPMorgan reported lower earnings.

However, investor sentiment was lifted early in the day after Italy successfully sold €4.75 billion of debt at lower borrowing cost. The Italian Treasury sold €3 billion of 6% November 2014 bonds at a yield of 4.83%, less than 5.62% it paid at an auction on December 29. Demand was 1.22 times the offer, down from 1.36 in the previous sale.

In London, FTSE 100 Index declined 45.54 or 0.8% to 5,616.41 and the pound edged higher to $1.5329.

For the week, the FTSE 100 Index fell 0.6%

UK Construction Output Climbs

Construction production in the United Kingdom rose in November, data released by the Office for National Statistics showed today.

The non-seasonally adjusted contraction output edged up 0.2% on a monthly basis in November, from the 0.1% decline in October.

On an annual basis, construction output decreased 1.6% in November.

UK Factory Gate Inflation Slows

The UK output price inflation eased to 4.8% in December from 5.4% in November, data released by the Office for National Statistics showed. This is the lowest annual rate since December 2010, when the index rose 4.2%.

On a monthly basis, output costs fell 0.2% in December.

Gainers & Losers

Hot Tuna (International) Plc plunged 43% to 0.04 pence after the surf wear and fashion brand agreed to dispose of the domain names, trademarks and certain of the Group''s stock to Project J Newco No.10 Ltd. for a consideration of £950,000.

Invensys Plc slumped 21% to 180 pence after the engineering company estimates fiscal year 2011 operating profit to be significantly below last year.

Spectris Plc soared 6.5% to 1,501 pence after the supplier of precision instrumentation and controls estimated sales for the full year 2011, on a reported basis, to be around 23% higher than in 2010, including a contribution from acquisitions of 7% and a positive currency effect of 1%.

Ted Baker Plc gained 4.9% to 734 pence after the clothing retail company reported a 15.7% increase in retail sales for the 8-week period from November 13, 2011 to January 7, 2012 versus the same period a year ago.

Volex plc slid 1.3% to 224 pence after the provider of interconnect solutions and power products reported third quarter revenue of $125.1 million with solid trading during the same quarter.