UK Public Sector Borrowing Rises, Vodafone Revenues Fall 8%

Arthi Gupta
20 Jul, 2012
New York City

The UK indexes declined after public sector net borrowing rose in June. The home price sentiment index dropped in July. Vodafone declined 2.8% on weak first quarter revenues. London and Singapore exchanges are reported to have merger talks.

[R]3:00 PM London – The UK indexes declined after public sector net borrowing rose in June. The home price sentiment index dropped in July. Vodafone declined 2.8% on weak first quarter revenues. London and Singapore exchanges are reported to have merger talks.[/R]

The UK indexes traded lower and ministers in the euro zone approved the Spanish bailout today. However, Spanish bond yields surged above 7%.

Euro-zone finance ministers unanimously agreed the bailout deal for Spanish banks on Friday during a conference call, the Eurogroup said in a statement.

Vodafone quarterly revenues fell due to the ongoing crisis in Spain and Italy and mobile termination rate cuts.

In London, the benchmark index FTSE 100 declined 44.48 or 0.8% to 5,669.85 and the pound edged lower to $1.5675.

For the week, the FTSE 100 rose 0.1%.

UK Home Market Confidence Wanes

Confidence over the UK housing market fell over the three months to June, according to a survey.

The headline House Price Outlook balance declined to 15 in June from 19 in March, the Lloyds Banking Group''s Halifax division said.

The survey found that 34% of respondents expect the average UK home price to rise over the next year, while almost 1 9% forecast a decline in prices.

Separately, the home price sentiment index dropped to 45.6 in July from 46.3 in June, data from a survey by Knight Frank and Markit Economics showed.

UK Public Sector Borrowing Rises

The UK public sector net borrowing, excluding the temporary effects of financial interventions rose to £14.45 billion in June from £13.92 billion during the same month last year, the Office for National Statistics reported today.

Public sector net debt was £1,038.3 billion at the end of June, equivalent to 66.1% of gross domestic product.

Gainers & Losers

Anglo American plc rose 1% to 2,056 pence after the miner stated second quarter iron ore production rose 12% to 12.9 million tons due to the ramp-up of the Kolomela mine and production improvements at Amapá. Total Copper production increased 7% to 161,100 tons.

BG Group plc fell 0.5% to 1,282.50 pence after the natural gas company and partners approved contracts totaling $4.5 billion for the construction of the first six topside modules and integration packages to be used on the Santos Basin pre-salt projects in blocks BM-S-9 and BM-S-11, offshore Brazil.

Ingersoll-Rand plc rose 0.2% to $41.47 after the diversified industrial company said second quarter reported revenues declined 7% to $3,821 million in the quarter a year ago. Net earnings in the quarter soared to $365.8 million or $1.16 per share compared to $92.3 million or $0.26 per share last year.

The London Stock Exchange Group Plc fell 0.6% to 1,017 pence after the independent bourse is in merger talks with the Singapore Exchange Ltd. for a potential £7.2 billion or $11.30 billion deal, media reports said on Thursday.

Vodafone Group plc declined 2.8% to 177.90 pence after the mobile communications operator reported first quarter total revenues declined 7.7% to £10.77 billion and data revenue grew 17.1% to £1.6 billion.