UK Rates, Bond Plan Unchanged; Sainsbury Rises

Mayank Mehta
07 Jan, 2010
New York City

The Bank of England left its key lending rate unchanged at 0.5% and kept its bond purchase plan unrevised. Auto sales in December surged on government incentives. UK home prices increased 1.1% in December and added 5.6% from a year ago. Persimmon gained. J Sainsbury same store sales increased 4.2%.

[R]4:00 PM London, 11:00 AM New York – The Bank of England left its key lending rate unchanged at 0.5% and kept its bond purchase plan unrevised. Auto sales in December surged on government incentives. UK home prices increased 1.1% in December and added 5.6% from a year ago. Persimmon gained. J Sainsbury same store sales increased 4.2%.[/R]

The Bank of England left its key lending rate at 0.5% and kept intact its government bond purchase program at 200 billion pounds.

Separately, mortgage lender Halifax said UK home prices increased 1% in December and increased 1.1% in the year compared to 2008 and increased 5.6% from a year ago.

Society of Motor Manufacturers said new car sales surged 39% in December as the government provided incentives to exchange old cars.

Retail trade sales in November fell 1.2% compared to October in euro area EA16 and 0.8% in the EU27. Compared with November 2008 retail sales index decline 4% in the euro area and 2.1% in the EU27.

In London FTSE 100 Index closed lower 7.18 or 0.13% to 5,522.86 and the pound edged lower to close at $1.592 and to €1.111.

Gainers & Losers

Arbuthnot Banking Group PLC rose 1.3% to 385.00 pence after the shares in banking and wealth management group said full year profit is ahead of market expectations.

Autonomy Corporation plc fell 0.3% to 1,555.00 pence and the company licensed its software to BAE Systems.

Beazley Group Plc rose 0.4% to 98.90 pence and the specialist insurer and reinsurer said it has increased its capital by $487 million and lowered the equivalent amount in the pound at the beginning of the year to protect it from future currency exchange volatility.

Cineworld Group plc the cinema chain operator dropped 0.3% to 163.00 pence.

Costain Group PLC the engineering and construction group rose 2.0% to 25.50 pence.

The Davis Service Group Plc dropped 0.8% to 398.60 pence after the laundry and workwear firm has boosted its European presence through two strategic acquisitions for a combined £44.5 million in cash.

Hays plc decreased 0.3% to 109.10 pence after the recruitment group said second quarter net fees fell 24% versus the same period last year and 30% on a like-for-like basis. Net fees from the permanent placement business decreased 39% and net fees from the temporary placement business decreased 22%.

J Sainsbury plc added 2.1% to 324.90 pence after the supermarket group said third quarter total sales rose 6.2%. Comparable same store sales increased 3.8% and 4.2% excluding fuel and VAT. Online grocery sales grew over 15%.

JD Sports Fashion PLC surged 10.9% to 610.00 pence after the retailer of sports and leisure wear said for the five-week period ended January 2 group comparable same store sales increased 6.6%.

Persimmon Plc surged 6.6% to 500 pence after the homebuilder said it sold 8,976 new homes in the year ending in December for £1.4 billion.

ProStrakan Group plc increased 8.2% to 92.00 pence after the loss-making specialty pharmaceuticals firm in its trading update reiterated guidance of 2009 total revenues in the range between £78 million and £79 million, up 40% from 2008 and line with management''s expectations.

Rathbone Brothers plc advanced 3.1% to 848.50 pence after the fund and wealth manager said net assets under management at the end of 2009 increased 25% to £13.1 billion.

Serco Group plc fell 0.09% to 526.50 pence.

Vodafone dropped 2.6% to 138.8 pence after its U.S. partner in the wireless communication said earnings per share declined 8% to 13 U.S. cents.

Wellstream Holdings Plc fell 0.1% to 557.50 pence after the flexible risers and flow-lines designer said that the board has not changed its outlook.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 53 increased, 49 declined and None were unchanged.

Prudential Plc decliners in the FTSE 100 index with a loss of 2.63% followed by losses in Vodafone Group Plc of 2.60%, in Standard Life Plc of 2.55%, in National Grid Plc of 2.25%, and in The Royal Bank of Scotland Group Plc of 2.21%.

Lloyds Banking Group Plc led gainers in the FTSE 100 index with a rise of 4.29% followed by increase in Wolseley Plc of 3.60%, in J Sainsbury Plc of 3.21%, in Barclays Plc of 2.77%, and in Cairn Energy Plc of 2.51%.