UK Stocks, Pound Rise; ICAP Offering

Trupti Mehta
20 Jul, 2009
New York City

The UK indexes edged higher after miners and financials closed up. ICAP, the inter-broker dealer completed raised 300 million euros through 5-year bonds. The pound gained after homes for sale were listed at higher prices. Domino

[R]5:00 PM London, 12:00 PM New York – UK edged higher after miners and financials closed up. ICAP, the inter-broker dealer completed raised 300 million euros through 5-year bonds. The pound gained after homes for sale were listed at higher prices. Domino’s Pizza UK increased 7% on 15% sales increase.[/R]

Political parties are proposing sweeping reforms in the way banks are regulated in UK ahead of election to gain voters sympathy and score talking points. David Cameron, the opposition party leader proposed to abolish Financial Services Authority and hand over the power to regulate banks to the Bank of England.

Treasury minister Paul Myners said that the plan will not work and the tighter supervision is a better solution.

In London FTSE 100 Index closed higher 15.38 or 0.35% to 4,361.84 and the pound closed at $1.64 and 1.16 euros. The pound gained after the home sellers raised price in July. The rise in commodities prices also contributed to the gains in the currency and stocks.

Gainers & Losers

Miners surged in London trading after copper prices in Shanghai gained to a five-week high. Kazakhmys surged 7.6% to 737.50 pence and Peter Hambro increased 4.7% to 626.50 pence. BHP Billiton added 3.4% to 1,492 pence.

Capital & Regional increased 11% to 30.25 pence after the property fund management group reported net asset values of three managed funds declined marginally in the three months ending in June.

Colefax Group PLC dropped 1.4% or 1.50 pence to 102.00 after he distributor of luxury furnishing fabrics & wallpapers said full-year sales fell 3% to £75.56 million from £78.18 million a year ago. Net profit for the year fell 55% to £1.83 million or 12.4 pence per diluted share compared to net profit £4.07 million or 26.1 pence per share a year ago.

Domino’s Pizza UK & Ireland rose 7.1% to 235.25 pence after the pizza delivery company said first-half sales rose 15% to £196.4 million. Pre-tax profit for the first-half rose 25% to £13.6 million.

Elan Corp increase 9.4% to 5.68 euros and Smith & Nephew Plc decreased 2.4% to 440.75 pence after broker comments. UBS recommended the Elan Corp with a ‘buy’ rating and Cazenove downgraded the implants maker Smith & Nephew. The swine-flu worries may delay implant operations according to the broker.

FDM Group Plc declined 9.4% or 10.50 pence to 101 pence after IT services business said first half trading has been in line with company expectations despite difficult economic conditions.

Friends & Provident added 2.4% after Resolution offered cash for the first 2,500 shares and pay the 2009 dividend to shareholders to increase the value of its merger offer with the company to individual shareholders. However, the company insisted to take control of the management.

Green King Plc increased 3.1% to 432.75 pence.

Japanese carmaker Nissan said it will start producing batteries for electric cars at a new site in Sunderland that may create as many as 350 jobs.

JJB Sports plc fell 2.0% or 50 pence to 26.75 pence after the sportswear retailer revelations about a £1.5m loan to executive chairman Sir David Jones from rival Sports Direct''s owner Mike Ashley.

Lloyds Banking Group surged 6.7% to 72.10 pence after investors speculated that recent market gains have lifted values of its sub-prime loans portfolio and the bank is expected to report higher than expected earnings.

Rightmove plc increased 5% to 378 pence after it said that average house for sale on the largest home sale site increased 0.6% in July to £227,854 pence, the fifth monthly increase. The prices in London increased 1.4% to £402,761

SThree Plc dropped 0.8% to 185 after the staffing firm said first-half sales fell 5% to £280.6 million from £295.4 million a year ago. Net profit for the first-half fell 90.6% to £1.3 million or 1.1 pence per diluted share compared to net profit £13.9 million or 10.5 pence per share a year ago.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 72 increased, 26 declined and 4 were unchanged.

Smith & Nephew plc decliners in the FTSE 100 index with a loss of 2.38% followed by losses in British Airways Plc of 2.35%, in Intertek Group plc of 2.31%, in Serco Group plc of 1.08%, in Anglo American plc of 1.00%.

Kazakhmys PLC led gainers in the FTSE 100 index with a rise of 7.59% followed by increase in Legal & General Group Plc of 7.57%, in Lloyds Banking Group plc of 6.68%, in Prudential Public Limited Company of 5.54%, in Eurasian Natural Resources of 5.31%.

Europe Markets Review

In London FTSE 100 Index closed higher 54.87 or 1.25% to 4,443.62, in Paris CAC 40 Index increased 52.48 or 1.63% to close at 3,270.94 and in Frankfurt DAX index higher 51.75 or 1.04% to close at 5,030.15. In Zurich trading SMI increased 33.79 or 0.60% to close at 5,627.93.