Jaguar Land Rover Job Cuts; Berkeley Net Falls

Mukesh Buch
26 Jun, 2009
New York City

UK stocks edged lower. The Bank of England report suggested that banks are in better conditions than they were six months ago. Jaguar and Land Rover may face more job losses and plant closures. Berkeley annual net falls 38% and net revenues declined 29%.

[R]7:00 PM London, 2:00 PM New York – UK stocks edged lower. The Bank of England report suggested that banks are in better conditions than they were six months ago. Jaguar and Land Rover may face more job losses and plant closures.[/R]

Investors are staying on the sidelines after a rally that lifted the benchmark index more than 28% in London. Market ahead of earnings in season in less than two weeks is taking a cautious view.

The UK banks rebounded after the Bank of England in a financial stability report said that banks are healthier than six months ago but are still vulnerable to economic and financial markets shocks.

In London FTSE 100 Index closed lower 11.56 or 0.27% to 4,241.01.

The Tata Motors reported that Jaguar and Land Rover division global sales in the ten months to March declined 28%. Land Rover sales fell 35% and Jaguar sales increased 1%. Tata Motors warned yesterday that it plans to close plants and may eliminate more jobs.

Tata said that Jaguar XF model is attracting good consumer response. Tata reported its first loss in eight years.

Gainers & Losers

Insurers declined. Legal & General Group declined 1.7% to 56 pence, Prudential fell 1.7% to 399.25 pence and Standard Life dropped 1.7% to 180 pence.

British Airways increased 2.2% to 129.30 pence after 7,000 people agreed to participate in voluntary program to work without pay for full or part time for one month.

British Sky Broadcasting dropped 0.5% to 449.50 pence after the media regulator and the company disagreed to open up films and Premier League football rights to other broadcasters. The regulator, Ofcom and the company may be heading to courts.

Berkley Group Holdings increased 1.4% 816.50 pence after it reported better than expected earnings. The managing director and co-founder Tony Pidgley resigned after 33 years with the company.

Filtrona Plc increased 6.7% to 122.25 pence after it confirmed the trading performance and indicated that its restructuring is in line with its expectations.

Forth Ports added 1.9% to 960 pence after it reiterated that the trading performance for the first half is expected to match results a year ago but container service and recycling businesses are weak.

Just Retirement surged 8.5% to 70 pence after it confirmed interest in its life assurance business from Avalon Acquisitions.

Lookers Plc surged 11% to 55 pence after it indicated that it is working to raise £80.7 million to repay its debt.

Earnings Review

The Berkeley Group Holdings plc, the urban regenerator and residential property developer said full-year revenues fell 29.2% to £702.2 million from £991.5 million a year ago. Net profit for the year fell 37.5% to £86.1 million or 65.6 pence per diluted share compared to net profit of £137.8 million or 114.1 pence per share a year ago.

The Berkeley Group Holdings plc, in the last one year traded as high as 1,071.00 pence in April 2009 and as low as 577.00 pence in July 2008. Based on the yesterday’s closing price of 819.50 pence the company has market cap of £1.07 billion.

THB Group plc, an independent insurance and reinsurance broker said first-half net profit fell 8% to £437 million or 1.30 pence per diluted share compared to net profit of £475 million or 1.65 pence per share a year ago.

THB Group plc, in the last one year traded as high as 78.00 pence in June 2008 and as low as 54.00 pence in December 2008. Based on the yesterday’s closing price of 78.00 pence the company has market cap of £25.24 million.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 42 increased, 58 declined and 2 were unchanged.

Invensys plc decliners in the FTSE 100 index with a loss of 2.44% followed by losses in The Sage Group PLC of 2.00%, in Eurasian Natural Resources Corporation PLC of 1.95%, in SABMiller plc of 1.88% and in BT Group plc of 1.75%.

Petrofac Limited led gainers in the FTSE 100 index with a rise of 4.63% followed by increase in The Royal Bank of Scotland Group plc of 3.74in Marks and Spencer Group plc of 2.97%, in Wolseley PLC of 2.78%, in Old Mutual plc of 2.56%.

Europe Markets Review

In London FTSE 100 Index closed lower 11.56 or 0.27% to 4,241.01, in Paris CAC 40 Index decreased 33.37 or 1.05% to close at 3,129.73 and in Frankfurt DAX index lower 24.09 or 0.50% to close at 4,776.47. In Zurich trading SMI increased 14.69 or 0.27% to close at 5,375.99.