Vodafone, BP Lift UK Stocks

123jump.com Staff
03 Feb, 2009
New York City

The stocks in UK and in Europe closed higher after a reversal in the afternoon trading. Vodafone reported better than expected sales increase, largely based on the strength in new customers in India. The Bank of England and the U.S. Fed agreed to extend the terms of currency swap arrangement.

[R]1:00PMNew York, 6:00PM London- The Bank of England extends currency swap arrangements with U.S. Federal Reserve. Vodafone revenues rise 14.3% to £10.5 billion.[/R]

U.K. stocks advanced buoyed by rising commodity prices and record earnings from Vodafone Group in the three months to December.

In London trading, FTSE 100 index gained 2.1% or 86.68 to 4,164.46.

Of the FTSE 100 index stocks, 84 rose, 16 declined, and 2 were unchanged. Xstrata led gainers in the index shares with a rise of 10.9% after copper prices jumped 4.7% to $3,324 per ton.

BoE Extends Currency Swap with the Fed

Bank of England reported today that it has extended its currency swap arrangements with the U.S. Federal Reserve to October 30, 2009.

The schedules cover operations providing 28-day and 84-day dollar liquidity.

U.S. Federal Reserve today also extended its reciprocal currency arrangements that applies to its swap lines with the Reserve Bank of Australia, Bank of England, Banco Central do Brasil, the Bank of Canada, Danmarks Nationalbank, European Central Bank, Bank of Korea among other central banks.

Separately, the BoE said in a statement it has accepted £287 billion collateral through the emergency lending program from troubled UK financial institutions.

However, the central bank has put a 16% discount on the securities to £242 billion.

Vodafone Revenue Rises 14.3%

Vodafone reported today that the company’s revenue advanced 14.3% to £10.5 billion from a year ago on merger and acquisition activity, especially in India.

Revenues in Europe fell 13.5% to £7.5 billion, Africa and Central Europe gained 6.9% to £1.4 billion and Asia, Pacific and Middle East advanced 26.9% to £1.5 billion.

The mobile telecommunications company said its cost saving program to reduce operating costs by £1 billion in 2011 is on track.

Service revenue in India grew by 37.3% in the review period, despite recent Pakistan trained terrorist attacks in Mumbai and deteriorating economic environment.

Net customer additions in India averaged 2.1 million per month and customer base rose to 60.9 million after the launch of services in six new circles during the quarter.

The company estimated that cell phone service penetration in the Indian mobile market reached 30% at the end of the December quarter.

Gainers & Losers

Xstrata led advancers in the FTSE 100 index shares with a rise of 10.9% followed by increases in Kazakhmys of 10%, in Aviva Plc of 8.2%, and Eurasian Natural of 7.1%.

Xstrata and other commodity prices increased after copper prices climbed 4.7% to $3,324 per ton. Gold prices also increased $7.4 to $910 per ounce.

London Stock Exchange led decliners in the FTSE 100 index shares with a decline of 7.2% followed by losses in Balfour Beatty of 6%, in Barclays Plc of 2.7% and in Schroders Plc of 2.5%.