1:30PM New York, 6:30PM London - UK consumer confidence falls record low.
Stocks in London rose despite separate reports showed consumer confidence fell the most in 18 years and UK banking confidence slumped as crude oil and metal prices extended gains.
Market sentiment
In London trading FTSE 100 gained 1.74% or 96 at 5,625.90.
Of the 102 FTSE 100 stocks 69 gained, 30 declined, and 3 were unchanged. Cobham led advancers in the index shares with a rise of 6.12% followed by a rise of 5% in Wood Group.
Consumer Confidence Drops
GfK reported on its Website today that the index measuring consumer confidence fell the most in 18 years by 5 points to 34 in June, near the record low. The index gauging personal finances dropped 6 points to 17, which is 20 points lower than the same period a year earlier, while the forecast for personal finances over the next year fell 5 points to 9.
The measure for the general economic situation of the country during the last twelve months declined 5 points to 66; 44 points lower than the comparable period a year ago, and the expectations for the general economic situation over the next year fell 6 points to 45; 35points lower than this time last year.
In addition, the major purchases measure slumped 3 points to 35.
Rachael Joy in the Consumer Confidence team at GfK NOP commented, This month the Index score continues to tumble and is almost at its lowest level since the survey began in 1974. At -34 it is only 1 point higher than the -35 recorded in March 1990 when the UK was heading into recession.
With rising inflation, gloomy forecasts for interest rates and soaring fuel, utility and food prices dominating the front page headlines, its no surprise that confidence in the general economy is almost in freefall. It seems unlikely that this trend will reverse in the near future.
UK banking confidence drops
The Confederation of British Industries reported on its Website today that the latest Financial Services Survey from the CBI and PricewaterhouseCoopers LLP showed credit remains expensive and in short supply, while nine out of ten firms say it will take more than six months for market conditions to return to normal. The survey also showed that 55% said business volume trends have declined and 20% of firms.
UK mortgages fall in May
The Bank of England reported today that U.K. banks granted 42,000 loans for house purchase compared with 58,000 in April.
Gainers & Losers
Cobham led gainers in the FTSE 100 index shares with a rise of 6.12% followed by rises in Wood Group of 5.27%, in Vodafone Group of 5.26%, in BG Group of 4.48%, and International Power Plc of 3.97%.
Commodity stocks rose after crude oil prices rose above $143 a barrel on speculation that simmering tensions over Iran nuclear program may reduce world exports.
Also reports by South Korean steel company Posco that it paid A$420 million for a 10% stake in Macarthur Coal also help boost commodities. BP gained 3.18%, Royal Dutch Shell-B edged up 2.96% and Rio Tinto advanced 2.84%.
ITV led decliners in the FTSE 100 index shares with a fall of 5.89% followed by losses in Friends Provident Plc of 3.58%, in London Stock Exchange of 3.17%, in Wolseley of 2.96%, and Lonmin Plc of 2.95%.
ITV dropped as Trinity Mirror said profit will be below its target and advertising sales will drop. |
