UK Stocks, Pearson Rally; HSBC, Prudential Drop

Mayank Mehta
01 Mar, 2010
New York City

UK stocks closed higher on a rally in resource stocks and commodities. Prudential Plc dropped 12% after it agreed to acquire Asia unit of AIG for $35.5 billion. Pearson plc increased after it reported better than expected earnings. HSBC declined 5.2% after it reported higher loan loss charges.

[R]4:00PM London, 11:00 AM New York – UK stocks closed higher on a rally in resource stocks and commodities. Prudential Plc dropped 12% after it agreed to acquire Asia unit of AIG for $35.5 billion. Pearson plc increased after it reported better than expected earnings. HSBC declined 5.2% after it reported higher loan loss charges.[/R]

UK stocks closed higher after a rally in resource stocks, Prudential in a merger deal with AIG for $35.5 billion and Greece inches closer in receiving a financial assistance.

Copper gained nearly 1.7% after Chile was struck with 8.8 magnitude earthquake sparking fears that supplies of the metal will be disrupted in the largest exporting region.

In London FTSE 100 Index closed higher 51.42 or 0.96% to 5,405.94 and the pound edged lower to close at $1.491 and fell to €1.104.

UK mortgage approvals declined in January to 48,198 loans from 58,223 loans in December. However, net lending increased to £1.5 billion from £1.2 billion in December. Total lending in 2009 declined 10% to £10.2 billion.

Gainers & Losers

Aggreko PLC rose 2.2% to 996.50 pence after the temporary power supplier secured the contract to supply of 215 MW of temporary power in Panama and in the Sultanate of Oman, worth an estimated $75 million.

Allergy Therapeutics plc increased 8.2% to 13.80 pence after the pharmaceutical company said first half revenues rose 12.8% to £27.3 million from £24.2 million a year ago. Net profit for the first half was £6.3 million or 2.1 pence per diluted share compared to net loss of £8.5 million or 10.3 pence per share a year ago.

Amlin plc climbed 2.4% to 404.50 pence an independent insurer said 2009 net earned premium revenue rose 44% to £1.32 billion from £913.5 million a year ago. Net profit for the 2009 rose 466% to £454.7 million or 92.9 pence per diluted share compared to net profit of £80.3 million or 16.9 pence per share a year ago.

Arena Leisure plc closed unchanged at 26.25 pence after the horseracing event organizer and racecourse operator said 2009 revenues rose 0.6% to £65.2 million from £64.8 million a year ago. Net profit for the year rose 3% to £4.2 million or 1.16 pence a diluted share compared to net profit of £4.08 million or 1.12 pence per share a year ago.

British Polythene Industries PLC closed unchanged at 290.00 pence after the polythene film producer said 2009 revenues fell 11.6% to £424.7 million from £480.7 million a year ago. Net profit for the year rose 189% to £8.1 million or 30.36 pence per diluted share compared to net profit of £2.8 million or 10.67 pence per share a year ago.

Etablissements Maurel et Prom SA gained 3.8% to 11.27 pence after the energy explorer said drilled in the Onal AEE, has identified a 111-metre column of oil in the Grès du Kissenda. Pump tests have established a flow of 1,700 bpd of oil (flow limited by the pump’s maximum capacity) with an API of 33.4.

Goals Soccer Centres plc closed unchanged at 143.00 pence an operator of five-a-side soccer centres said 2009 revenues rose 9% to £26.2 million from £24.0 million a year ago. Net profit for the year rose 9% to £6.07 million or 13.0 pence per diluted share compared to net profit of £5.58 million or 12.8 pence per share a year ago.

HSBC Holdings plc dropped 3.4% to 694.50 pence after the banking and financial services organization said 2009 net interest income fell 4.5% to $40.7 billion from $42.6 billion a year ago. Net profit for the 2009 rose 2% to $5.83 billion or $0.34 per diluted share compared to net profit of $5.73 billion or $0.41 per share a year ago.

Pearson plc added 0.8% to 919.50 pence after the educational and financial information publisher said 2009 sales increased 4% at constant exchange rates to £5.6 billion, adjusted operating profit up 4% to £858 million; underlying sales and profit growth of 2%.

Senior plc increased 7.6% to 84.50 pence an engineering firm said 2009 revenues fell 4% to £540.1 million from £562.4 million a year ago. Net profit for the 2009 fell 0.5% to £39.0 million or 9.58 pence per diluted share compared to net profit of £39.2 million or 9.78 pence per share a year ago.

SDL plc fell 0.09% to 453.60 pence after the provider of global information management solutions 2009 revenues rose 8% to £171.9 million from £158.8 million a year ago. Net profit for the year rose 23% to £17.9 million or 22.79 pence per diluted share compared to net profit of £14.5 million or 18.75 pence per share a year ago.

Tomkins plc increased 4.0% to 200.30 pence after the global engineering and manufacturing company said 2009 revenues fell 24% to $4.18 billion from $5.52 billion a year ago. Net loss for the 2009 was $15.6 million or 1.77 cents per diluted share compared to net loss of $64.6 million or 7.34 cents per share a year ago.

Ultra Electronics Holdings plc increased 2.1% to 1,355.00 pence after the defence industry supplier said 2009 revenues rose 26% to £651.0 million from £515.3 million a year ago. Net profit for the 2009 rose 4,261% to £78.5 million or 114.8 pence per diluted share compared to net profit of £1.8 million or 2.6 pence per share a year ago.

WSP Group plc advanced 3.0% to 274.00 pence after the building and environmental services company said 2009 revenues fell 4% to £723.3 million from £755.2 million a year ago. Net profit for the 2009 fell 65% to £13.0 million or 20.4 pence per diluted share compared to net profit of £36.8 million or 57.4 pence per share a year ago.

Xchanging plc rose 1.2% to 186.30 pence after the acquisitions helped offshoring specialist announced that the Board has approved the payment of a 2009, interim dividend of £0.0275 per share payable on April 1, to all shareholders on the share register at the record date March 19.

Xstrata plc climbed 2.4% to 1,055.50 pence after the mining company, Xstrata Nickel announces that the company’s sudbury operations has reached a tentative agreement for a new collective Agreement with the United Steelworkers Union Local 2020, which represents Xstrata Nickel’s Sudbury office, clerical and technical employees. The prior agreement expired at midnight on February 28.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 87 increased, 15 declined and none were unchanged.

Prudential Plc decliners in the FTSE 100 index with a loss of 12.03% followed by losses in HSBC Holdings Plc of 5.23%, in Legal & General Group Plc of 5.12%, in Lloyds Banking Group Plc of 4.27%, and in Aviva Plc of 3.87%.

Aggreko Plc led gainers in the FTSE 100 index with a rise of 6.05% followed by increase in Kazakhmys Plc of 5.15%, in Pearson Plc of 4.82%, in SABMiller Plc of 4.48%, and in Fresnillo Plc of 4.26%.