UK Retail Sales Fall, InterContinental Profit Soars

Arthi Gupta
09 May, 2012
New York City

The UK indexes dropped 1% tracking losses in Europe as Greece struggles to form a new government and the prospect of another election looms large. Retail sales in the UK fell in April. GlaxoSmithKline planned to take its hostile $2.6 billion bid for U.S.-based Human Genome Sciences to shareholders.

[R]3:30 PM London – The UK indexes dropped 1% tracking losses in Europe as Greece struggles to form a new government and the prospect of another election looms large. Retail sales in the UK fell in April. GlaxoSmithKline planned to take its hostile $2.6 billion bid for U.S.-based Human Genome Sciences to shareholders.[/R]

The UK indexes slid as Greek negotiations to form a new government falter and the prospect of another election as early as June looms large.

Investors are increasingly factoring the possibility of Greece exiting the euro zone, once unthinkable only weeks ago.

Euro zone leaders are expected to meet in the next two weeks to discuss the future bailouts for Greece and the possible losses stemming from the Greek default.

Alexis Tsipras, leader of Greece''s left-wing Syriza party has been given the mandate by President Karolos Papoulias to form a government within the next three days. However, Tsipras refused to enter in a coalition with parties that supported the bailout and declared the loan agreement “null.”

In London, the benchmark index FTSE 100 declined 61.94 or 1.1% to 5,491.54 and the pound edged lower to $1.6089.

UK Retail Sales Fall

Retail sales in the United Kingdom declined in April as wet weather damped consumer spending, according to survey results published by the British Retail Consortium today.

Comparable retail sales fell 3.3% from April a year ago when they were up 5.2%, BRC said. Sales had risen 1.3% from a year ago in March.

Gainers & Losers

CRH plc fell 1.9% to €13.89 after the diversified building materials company said cumulative comparable sales to April rose 2% from the same period a year ago.

Diageo plc declined 0.6% to 1,540.50 pence after the premium drinks business priced a $2.5 billion bond offerings that included $1 billion 1.5% bonds maturing in May 2017, $1 billion 2.875% maturing in May 2022 and $500 million 4.25% maturing in May 2042 fixed rate notes.

easyJet Plc rose 1.3% to 513 pence after the budget carrier reported first-half total revenue climbed 15.7% to £1.47 billion from £1.27 billion. Pre-tax loss for the period narrowed 27% to £112 million from £153 million last year.

Glencore International Plc climbed 1.6% to 398.10 pence after the Swiss commodities trader said first quarter Kazzinc gold production increased 24% and Katanga copper metal production rose 2% year-on-year. In Mutanda, copper production surged 46%.

GlaxoSmithKline PLC fell 1.3% to 1,406.50 pence after the pharmaceutical maker said it will commence a tender offer to acquire Human Genome Sciences for $13.00 per share in cash and take its $2.6 billion bid directly to shareholders.

InterContinental Hotels Group PLC dropped 1.2% to 1,447 pence after the hotel company stated first quarter revenue rose 3.3% to $409 million compared with $396 million in the previous year. Profit for the period surged 123% to $154 million from $69 million a year ago.

Prudential plc declined 2.2% to 695 pence after the financial services group reported first quarter annual premium equivalent sales increased 9% to £964 million from £888 million last year. Total group insurance''s new business profit rose 8% to £536 million from £498 million a year earlier.

Thomas Cook Group PLC plunged 5.8% to 20.25 pence and the leisure travel company appointed Michael Healy as Chief Financial Officer and the tour operator agreed to new lending conditions with banks.