Lloyds Leads UK Stocks Decline

123jump.com Staff
03 Apr, 2008
New York City

Lenders of home and corporate loans are likely to curtail their lending activities in the near future as credit markets remain tight, according to a report published on the Bank of England Web site. The interbank lending in UK and in the European region still remains tight. International Power led advancers in the FTSE 100 index shares with a rise of 3.73% followed by increases in BG Group Plc of 3.47%, in Severn Trent of 2.76%, in Anglo American Plc of 2.29%, and Lonmin Plc of 2.13%.

[R]1:00AM New York, 6:00 PM London – Home lenders are expected to tighten mortgage lending in the coming months. Utilities and miners led the gainers in the index stocks.[/R]

Stocks in London declined after a report by the Bank of England showed that credit conditions will deteriorate in the mortgage market in the next three months.

In London trading FTSE 100 fell 0.42% or 24.6 to 5,891.30.

Of the 102 FTSE 100 stocks 28 gained and 74 declined. International Power led advancers with a rise of 3.71% followed by BG Group increasing 3.47%.

U.K lenders plan to cut mortgage and corporate lending

The Bank of England reported on its Web site in the Credit Conditions Survey for the first quarter that financial institutions are planning to cut mortgage and corporate lending, as there will be marginally larger reduction in home loans on the second quarter.

HSBC’s online unit First Direct yesterday suspended mortgage lending to new customers after being inundated by applications for home loans at low rates.

Gainers & Losers

International Power led advancers in the FTSE 100 index shares with a rise of 3.73% followed by increases in BG Group Plc of 3.47%, in Severn Trent of 2.76%, in Anglo American Plc of 2.29%, and Lonmin Plc of 2.13%.

Severn Trent, environmental services provider rose a day after it reported its earnings and after Morgan Stanley raised its recommendation on the stock to ``overweight'''' from ``equalweight.”

Commodity stocks rose as well. BHP Billiton rose 2.09%, Antofagasta increased 2.06% and Tullow Oil increased 1.72%.

Wolseley Plc led decliners in the FTSE 100 index with a drop of 5.68% followed by losses in Legal and General Group of 5.22%, in Carnival Plc of 5.16%, in Persimmon 4.76%, and Kingfisher of 4.70%.

Homebuilders fell on news the lenders plan to cut home loans in the second quarter. Home Retail Group and British Land Co. slid 3.92% each.

Financial institutions declined as well. Lloyds TSB Group declined 4.24% and Alliance & Leicester plummeted 3.85%.

Terminal 5 chaos to cost £16 million

British Airways reported today that the confusion in the opening of London Heathrow airport''s Terminal 5 will cost it £16 million pounds as the passenger total for the month of March dropped by 78,000.

Willie Walsh, chief executive in a statement published on British Air Web site apologized for the poor service and asserted that the baggage service is “generally” better.

He further added, “Since Thursday, when Terminal 5 opened, we have made clear that the service we have provided has not been good enough. We apologise sincerely to our customers. The baggage system is now generally working better. From time to time problems have developed that were not encountered during the extensive trials. These issues are being addressed as they arise by a team of engineers and IT specialists from BAA and BA.”

The airliner has since enlisted the services of FedEx Corp. and 400 volunteers from its ranks to help clear a backlog of 20,000 bags that built up since the terminal opening on March 27th.

The scheduled published on the airline Web site shows that less than 10% flights are expected to be cancelled between today and tomorrow.

International Markets Review

In Tokyo Nikkei 225 Index closed higher 200.54 or 1.52% to 13,.389.90, in Hong Kong Hang Seng index increased 392.20 or 1.64% closed to 24,264.63. In Australia ASX 200 index higher 106.00 or 1.93% to close 5,608.90. In Malaysia KL Composite index decreased 14.07 or 1.14% closed to 1,225.58.

In South Korea Kospi Index increased 21.44 or 1.23% to close at 1,763.63, in Thailand SET index closed higher 0.97 or 0.12% to 826.68 and Indonesia JSE Index edged decreased 104.22 or 4.45% to 2,237.97. Sensex index in India increased 82.15 or 0.52% to 15,832.55.

In London FTSE 100 Index closed lower 24.60 or 0.42% to 5,891.30, in Paris CAC 40 Index decreased 24.10 or 0.49% to close at 4,887.87 and in Frankfurt DAX index lower 35.72 or 0.53% to close at 6,741.72. In Zurich trading SMI decreased 80.42 or 1.06% to close at 7,516.23.