Volatile FTSE and Oil, LSE Falls

123jump.com Staff
22 May, 2008
New York City

Energy and mining companies dominated FTSE 100 index traded volatile as crude oil surged above $135 a barrel and closed below $133. The crude oil volatility dragged stocks up and down in listless trading. In earnings news, LSE fell 5% after it reported a profit of 174 million pounds and offered an optimistic outlook that analysts questioned. The largest European stock exchange fell on the worries that rising competition from alternative platforms may hurt the margins.

[R]1:00PM New York, 5:00PM London - U.K. retail sales fall 0.2% in April but retail volume rose 1.5%. Oil prices rise above $135 per barrel but fall near $133 at close.[/R]

London stock indexes fell in volatile trading as oil rose above $135 per barrel. Losses were however pared by rising retailers on a government report that showed the retail sales volume in the quarter to April increased 1.5% from the previous quarter.

In London trading FTSE 100 stocks fell 0.27% or 16.5 at 6,181.60. Of the 102 FTSE 100 stocks 42 gained, 60 declined, and 1 was unchanged. British Airways led advancers in the index shares with a rise of 4.69% followed by Vodafone Group increasing 3.09%.

U.K. retail sales drop 0.2% in April

The Office of National Statistics reported today on its Web site that in the three months to April the seasonally adjusted index for volume of retail sales increased by 1.5% from a quarter earlier.

Volume of sales in predominantly food stores in the latest quarter advanced by 1.0% over the previous three months, while in the predominantly non-food stores sales increased 1.7%. However, between March and April the volume of sales dropped by 0.2% due to declines in food stores and household goods.

Also in February to April the seasonally adjusted volume of sales was 4.8% higher than a year earlier and within this predominantly food stores retail sales were up 2.2% and non-food stores sales were 5.4% higher. Non-store retailing and repair sector was 17.9% higher than a year ago.

According to the statistics office, in seasonally adjusted terms the average weekly value of retail sales in April was 1.9% higher than in the same month a year ago at £5 billion.

On the overall, the value of sales for all retailing in February to April increased 4.3% from a year earlier. Food stores sales were 5.3% higher, while sales by predominantly non-food stores was 2.8% up from the same period a year ago.

In addition, non-store retailing and repair sector sales were 9.7 % higher than a year ago.

Crude oil jumps above $135 per barrel

Crude oil futures today rose above $135 a barrel after an unexpected fall in US stocks of crude and an increase in demand for diesel from China. In the morning trading in Asia, oil reached a high of $135.04 a barrel, but later retreated to $133 a barrel. In New York trading crude oil increased above $135 a barrel but closed down $2 a barrel to above $130 a barrel.

Chinese government said it imported 6% more diesel last month than the month before.

The comments from Opec members suggested that they can not influence the price of crude and there is enough crude available in the market. The comments from the Libyan oil minister suggested that financial speculators are driving the price and not the demand supply of energy markets.

Gainers & Losers

British Airways led advancers in the FTSE 100 index shares with a rise of 4.69% followed by rises in Vodafone Group of 3.09%, in Scottish & Nephew of 2.94%, in Cable Wireless of 2.69%, in Wolseley Plc of 2.67%.

Cable & Wireless rose after it reported the company is mulling splitting and selling assets after net income dropped 5.7% to £164 million as sales fell 5.9% to £3.2 billion.

Other retailers rose as well. Kingfisher rose 1.78%, Next increased 1.58%, Tesco edged up 1.56% and Sainsbury gained 1.40%.

Imperial Tobacco Group led decliners in the FTSE 100 index shares with a fall of 15.24% followed losses in London Stock Exchange of 4.60%, in Cairn Energy of 3.88%, and BG Group Plc of 3.37%.

Energy stocks fell after oil prices rose above $135 per barrel and later retreated to $133 per barrel. Royal Dutch Shell class A stock plummeted 2.05%.