UK PPI Rises, Stocks Gain; RBS Surges

123jump.com Staff
08 May, 2009
New York City

UK stocks rallied on the back of positive trading sentiment after lower than expected jobless claims in the U.S. Royal Bank of Scotland surged on 26% increase in revenues. Miners climbed higher on a rise in commodities prices. Producer Price index increased at a faster pace in April.

[R]6:00PM London – UK stocks rallied on the back of positive trading sentiment after lower than expected jobless claims in the U.S. Royal Bank of Scotland surged on 26% increase in revenues. Miners climbed higher on a rise in commodities prices. Producer Price index increased at a faster pace in April.[/R]

Stocks in London closed higher after the release of stress test results, better than expected monthly jobless claims in the U.S. and higher revenues at the Royal Bank of Scotland. The wholesale price index edged higher in April.

The Office of National Statistics reported producer price index increased in April by 0.6% compared to a rise of 0.1% in March. The index rose at 0.4% excluding the changes in excise duty. For the twelve months ending in April, the index increased at 1.2% after rising at 2% for the period ending in March.

Petroleum products registered the highest increase of 4.3% in the month from March and metal products declined 0.2%. Food, electrical and optical and textiles and clothing were unchanged in the month.

Commodities linked stocks gained after the weekly jobless claims in the U.S. at the end of last week declined to 539,000, lower than expected by most economists.

Anglo American increased 5% to 1,625 pence, BHP Billiton increased 1.5% to 1,535 pence and Xstrata Plc added 5.4% to 723 pence. Kazakhmys Plc surged 7% to 767 pence.

BP increased 2.2% to 521 pence.

3i Group Plc increased 14.4% to 387.75 pence after the company proposed its first rights offering to raise 700 million pounds.

Earnings Review

Unilever PLC, the world’s second-largest consumer goods maker said first quarter revenues fell 0.7% to €9.5 billion from €9.57 billion a year ago. Net profit for the quarter fell 45.4% to €731 million or €0.25 per diluted share compared to net profit of €1.34 billion or €0.46 per share a year ago.

Unilever PLC, in the last one year traded as high as 1,786.00 pence in May 2008 and as low as 1,226.00 pence in March 2009. Based on the yesterday’s closing price of 1,443.00 pence the company has market cap of £18.52 billion.

The Royal Bank of Scotland Group plc, the global banking and financial services group said first quarter revenues rose 26% to £9.7 billion from £7.7 billion a year ago. Net loss for the quarter was £857 million compared to net profit of £245 million a year ago.

The Royal Bank of Scotland Group plc, in the last one year traded as high as 360.24 pence in May 2008 and as low as 10.00 pence in January 2009. Based on the yesterday’s closing price of 46.20 pence the company has market cap of £25.87 billion.

Inmarsat Plc, the provider of global mobile satellite communications services said first quarter revenues rose 10% to $163.4 million from €147.9 million a year ago. Net profit for the quarter rose 35.3% to $39.1 million compared to net profit of $28.9 million a year ago.

Inmarsat Plc, in the last one year traded as high as 585.00 pence in September 2008 and as low as300.00 pence in October 2008. Based on the yesterday’s closing price of 575.50 pence the company has market cap of £2.55 billion.

FTSE 100 Index Movers

Of the stocks in the FTSE index, 63 increased, 38 declined and 1 were unchanged.

Brit Land Co Plc decliners in the index with a loss of 9.42% followed by losses in Liberty International PLC, of 8.13%, in Land Securities Group plc, 5.91%, in Hammerson PLC of 5.41% and in Thomas Cook Group plc of 5.15%.

The Royal Bank of Scotland Group plc led gainers in the FTSE 100 index with a rise of 13.94% followed by increase in ICAP plc of 8.58%, in Vedanta Resources plc of 8.42%, in Friends Provident PLC of 7.69, in Schroders PLC of 7.54%, in Fresnillo Plc of 7.14%.

Europe Markets Review

In London FTSE 100 Index closed higher 56.31 or 1.44% to 4,462.09, in Paris CAC 40 Index increased 61.07 or 1.88% to close at 3,312.59 and in Frankfurt DAX index higher 109.80 or 2.29% to close at 4,913.90. In Zurich trading SMI increased 65.38 or 1.23% to close at 5,391.01.