By Carla Mozee, MarketWatch Bank of England holds key rate at
0.5%
LONDON (MarketWatch) -- The U.K.'s FTSE 100 inched lower
Thursday, weighed down by losses from resource-sector companies, as
shares of travel operators easyJet PLC and TUI Travel PLC moved
higher.
At the same time, the pound was largely unchanged against the
U.S. dollar after the Bank of England made no change in monetary
policy, as expected.
The FTSE 100 was up 0.1% at 6,722.48, winning back a portion of
the 0.4% decline on Wednesday, during which investors assessed the
closely watched Autumn Statement, a wide-ranging update on the
state of the U.K. economy and the government's policy plans.
Budget carrier easyJet PLC was among the winners on Wednesday,
as the U.K. government said it will exempt children from taxes on
economy-class flights. On Thursday, easyJet shares jumped 2.1% as
the company logged 3.1% growth in passengers in November. Load
factor, or the percentage of seats filled with passengers, rose to
89.5% from 89%.
Shares of TUI Travel picked up 4% as the vacation-package
provider posted an 11% rise in fiscal 2014 underlying operating
profit on a constant currency basis, surpassing its recently raised
forecast.
Also higher Thursday, Unilever PLC rose 2% on the
consumer-products maker's decision to turn its spreads division --
which includes the Bertolli margarine brand -- into a stand-alone
company, as the unit weighs on the rest of business.
On the losing end of the FTSE 100, Rio Tinto PLC shares fell
1.8%, with the mining heavyweight saying at an investor seminar
that "[w]hile the long-term horizon remains robust, the near-term
outlook is more challenging." Rio Tinto also said total capital
expenditure is below $8.5 billion forecast for 2014, and operating
and exploration costs will be reduced by $5.4 billion by the end of
2015.
Shares of miners Anglo American PLC and BHP Billiton PLC also
fell, by 2.2% and 1.5%, respectively.
Goldman Sachs said in a note dated Dec. 3 that it's retaining
its sell rating on the iron-ore miner. It added that Rio Tinto is
the most exposed in its iron-ore coverage to continued pressure
from additional supply and moderating demand growth in China. Rio
Tinto was removed from Goldman's pan-European conviction sell
list.
Oil stocks were again in the red, resuming a recent run of
declines as the oil industry grapples with a steep fall in crude
prices. Shares of Tullow Oil PLC fell 1.5%, BP PLC moved 1.8% lower
and Royal Dutch Shell PLC gave up 1.1%.
Back to sterling (GBPUSD) , the currency was buying $1.5669
compared with $1.5672 ahead of the Bank of England's statement that
it's keeping its key rate at 0.5% and maintaining the size of its
asset-purchase plan at 375 billion pounds ($588.65 billion). The
pound late Wednesday fetched $1.5685.
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