Weak UK Manufacturing, Miners Rise

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

Stocks in London trading rose 1.5% after metal and commodities prices gained. Of the FTSE 100 index stocks, 80 rose, 19 declined and 3 were unchanged. Rising pound and weak demand in international markets dragged manufacturing index lower in October. The sixth monthly decline in a row.

[R]1:00PM New York, 6:00PM London- U.K. manufacturing activity falls in October[/R]

London market averages rose 1.5% after commodity stocks advanced on a rise in metal prices. However weak manufacturing activity in October pared gains.

In London trading FTSE index rose 1.5% or 65.94 to 4,443.28.

Of the FTSE index stocks 80 rose, 19 declined, and 3 were unchanged. Kazakhmys led advancers in the index shares with a rise of 18.3% after copper prices increased 1.6%.

Manufacturing Index Falls to 41.5 in October

Times Online reported today that the Chartered Institute of Purchasing & Supply/Markit index fell for the sixth consecutive month to 41.5 in October.

New export orders index at 43.5, the biggest decline since September 11, 2001 while a backlog of work for manufacturers dipped markedly.

The CIPS'' employment index also declined to a record low as employers reduced the staff headcount in line with plummeting production.

In addition, a measure of raw materials costs declined to 55.6 from 71.8 and a measure of output prices was at 59.

Roy Ayliffe, CIPS director of professional practice said, """"Conditions for UK manufacturers remained brutal in October as the turmoil in the world''s financial markets showed no signs of abating.""""

LSE to Charge Alternative Trading Platforms

Bloomberg News reported that London Stock Exchange plans to charge 1 basis point to alternative trading platforms for conducting transactions.

Competition has heightened among trading platforms on new entrants to the market.

Gainers & Losers

Kazakhmys led advancers in the FTSE 100 index shares with a rise of 18.3% followed by increases in Old Mutual of 15.4%, in Eurasian Natural of 12.9%, in Xstrata Plc of 10.3%, and ICAP Plc of 8.1%.

Kazakhmys and other commodity stocks rose after copper prices increased 1.6%. Gold prices also gained 1.8% to $731 per ounce and Nickel futures soared 1.7%.

Fresnillo led decliners in the FTSE 100 index shares with a fall of 4.1% followed by losses in Barclays Plc of 4.1%, in Royal Bank of Scotland of 3.4%, in Lonmin Plc of 3.4%, and Johnson Matthey of 2.9%.

Tesco fell 2% after Societe Generale downgraded stock to """"sell"""" from """"hold"""".

HSBC Might Not Cut Rates

Bloomberg News reported today that HSBC chief operating officer David Hodgkinson said in an interview in Abu Dhabi today that the lender might not pass the lower rate from the Bank of England to consumers and businesses as banks a """"re-evaluating the price they put on risk"""".

The government is urging banks to return lending to 2007 levels.

Europe Markets Review

In London FTSE 100 Index closed higher 65.94 or 1.51% to 4,443.28, in Paris CAC 40 Index increased 40.90 or 1.17% to close at 3,527.97 and in Frankfurt DAX index higher 38.87 or 0.78% to close at 5,026.84. In Zurich trading SMI increased 80.67 or 1.31% to close at 6,233.88.