UK Benchmark Lower on Weak Financials

Mayank Mehta
22 Jan, 2010
New York City

UK financials and miners led the decliners for the third day in a row. The benchmark index is in loss for 2010. Miners fell on the worries that China will tighten monetary policy and banks declined on limit on risk taking activities in the U.S. may spread to Europe.

[R]4:00 PM London, 11:00 AM New York – UK financials and miners led the decliners for the third day in a row. The benchmark index is in loss for 2010. Miners fell on the worries that China will tighten monetary policy and banks declined on limit on risk taking activities in the U.S. may spread to Europe.[/R]

UK banks and financial services stocks led the decliners for the third day in a row. The benchmark index is now in the negative in the year as miners dropped for the second day.

In London FTSE 100 Index closed lower 32.11 or 0.60% to 5,302.99 and the pound edged lower to close at $1.609 and edged lower to close at €1.140.

Barclays declined 4.1%, LSE fell 4.3%, ICAP Plc dropped 6.6% and Tullett Prebon Plc fell 6%. The banks, brokerages and other financial declined after the U.S. President Obama proposed a plan to limit risk taking at banks that may be adopted by the European and UK regulators.

Year-on-Year UK volume of retail sales in December rose 2.1%. Predominantly food stores sales increased 2.8%. The largest increase was textile, clothing and footwear stores at 4.7%. Total sales volume from October to December increased 2.7%.

Gainers & Losers

Close Brothers Group plc fell 1.4% to 704.50 pence despite the merchant banker making positive comments for the business conditions. The stocks of the financial services fell on the worries that tighter regulations and limit of risk taking will cut into future profits.

Cobham plc fell 0.2% to 238.40 pence and the defense and aerospace group appointed John Devaney as an independent non-executive director and chairman-designate effective Feb 1.

Gem Diamonds Limited decreased 0.7% to 238.50 pence.

Halma plc decreased 0.6% to 238.50 pence and the electronic sensors company announces the acquisition of SphereOptics, LLC from current management and financial shareholders for an initial cash consideration of $2.5 million or £1.5 million.

Invensys plc added 1.2% to 307.20 pence after the engineer group said that it generated net income in the third quarter before exceptional items as it had guided.

PartyGaming soared 6.2% to 285.5 pence after Austria based Bwin Interactive Entertainment AG confirmed that it is in merger talks with the company.

Petropavlovsk Plc dropped 6% to 981 pence after it completed the senior unsecured convertible bond offering of $330 million.

Stobart Group Limited dropped 0.9% to 135.70 pence.

Xstrata plc fell 0.3% to 1,095 pence and the copper division revised mineral resource estimate for the copper-gold project in Papua New Guinea.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 15 increased, 84 declined and 3 were unchanged.

ICAP Plc decliners in the FTSE 100 index with a loss of 6.58% followed by losses in London Stock Exchange Group Plc of 4.32%, in Barclays Plc of 4.12%, in Resolution Limited of 3.83%, and in Legal & General Group Plc of 2.99%.

Xstrata Plc led gainers in the FTSE 100 index with a rise of 2.37% followed by increase in Eurasian Natural Resources Corporation Plc of 1.70%, in Invensys Plc of 1.22%, in Kazakhmys Plc of 1.09%, and in Anglo American Plc of 0.70%.