UK Stocks Rise, Sainsbury Surges

123jump.com Staff
28 Aug, 2008
New York City

In London trading FTSE 100 rose 1.32% or 73.1 to 5,601.20. Of the 102 FTSE 100 stocks 83 rose, 18 declined, and 1 was unchanged. Sainsbury led advancers in the index shares with a rise of 7.92% followed by Wolseley increasing 5.87%. Nationwide Building Society reported today that house prices fell 1.9% from a month ago and 10.5% from the previous year to

[R]1:00PM New York, 6:00PM London - U.K. house prices fall 10.5% in August[/R]

London market averages rose led by retailers on speculation that Qatar might renew its offer for Sainsbury.

Market Sentiment

In London trading FTSE 100 rose 1.32% or 73.1 to 5,601.20. Of the 102 FTSE 100 stocks 83 rose, 18 declined, and 1 was unchanged. Sainsbury led advancers in the index shares with a rise of 7.92% followed by Wolseley increasing 5.87%.

U.S Economy Rises 3.3% in Q2

The U.S. Commerce Department reported on its Web site today that the economy rose 3.3% in the second quarter of 2008 on high exports that were buoyed by a weak dollar beating the estimates of a rise of 1.9%.

Exports grew at an annualized rate of 13.2%, beating the government’s projections of 9.2%, while imports declined 7.6% on slowing economic growth. Consumer spending rose 1.7% in the quarter after rising 1.5% in the first quarter leveraged by the tax stimulus package.

U.K House Prices Fall 10.5% in August

Nationwide Building Society reported on its Web site today that house prices fell 1.9% from a month ago and 10.5% from the previous year to £164,654.

Home builders have been reporting significant reductions in site visits and reservations of new properties since the same period a year earlier. In addition to stricter lending criteria lack of confidence in the housing market has also impacted on the number of transactions completed.

Nationwide chief executive Fionnuala Earley said, “ There is clearly less mortgage borrowing taking place in the current market, but those borrowers choosing a new loan are tending to opt for fixed rate loans, even though they have been more expensive than trackers.”

Gainers & Losers

Sainsbury led advancers in the FTSE 100 index shares with a rise of 7.92% followed by rises in Wolseley of 5.87%, in Barclays of 5.83%, in RSA Insurance of 5.69%, and Friends Provident of 5.38%.

Sainsbury rose after Reuters News reported that the company might receive a renewed bid. Speculation swelled that Qatar might renew its bid.

Other retailers also advanced as well. Next increased 4.14% and Marks & Spencer edged up 3.87%.

Kazakhmys led decliners in the FTSE 100 index shares with a fall of 2.54% followed by losses in Severn Trent of 2.14%, in Eurasian Natural of 2.11%, in Cairn Energy of 1.86%, and Petrofac of 1.35%.

Other commodity stocks dipped as well. Tullow Oil declined 0.55%, and Xstrata slumped 0.98% and BP slipped 0.67%.

Europe Markets Review

In London FTSE 100 Index closed higher 73.10 or 1.32% to 5,601.20, in Paris CAC 40 Index increased 88.41 or 2.02% to close at 4,461.49 and in Frankfurt DAX index higher 99.51 or 1.57% to close at 6,420.54. In Zurich trading SMI increased 103.76 or 1.46% to close at 7,190.40.