Bloomberg News

U.K. Shares Rise for Fourth Day on Greek Aid; Vodafone Rallies

July 22, 2011

July 22 (Bloomberg) -- U.K. stocks climbed for a fourth day as European leaders agreed a new aid plan for Greece and Vodafone Group Plc posted revenue that topped estimates.

Vodafone, the world’s largest mobile-phone company, climbed to a two-week high. EasyJet Plc led travel companies higher, surging 18 percent, after the discount airline forecast earnings will beat estimates. Aviva Plc advanced amid speculation the insurer could be a takeover target.

The FTSE 100 Index rose 35.13, or 0.6 percent, to 5,935.02 at the 4:30 p.m. close in London, extending this week’s gain to 1.6 percent. The gauge has still lost 2.6 percent since its February high amid speculation Europe’s debt crisis may spread beyond Greece. The broader FTSE All-Share Index gained 0.7 percent today, while Ireland’s ISEQ Index rose 1.4 percent.

“The latest deal for Greece has come as a relief,” said London-based Yusuf Heusen, senior sales trader at IG Index. “The focus is now back on the American deficit problem.”

Euro-area leaders announced 159 billion euros ($229 billion) of new aid for Greece and cajoled bondholders into footing part of the bill. They also empowered their 440-billion euro rescue fund to buy the debt of stressed nations to help erect a firewall around Spain and Italy.

Elsewhere, U.S. President Barack Obama and House Speaker John Boehner pressed for a broad agreement to boost the debt limit for the world’s largest economy while cutting spending before the Aug. 2 deadline.

Vodafone Gains

Shares of Vodafone rallied 2 percent to 164.55 pence after reporting a 1.5 percent increase in service revenue as demand for smartphones bolstered data sales. That beat the 1.4 percent gain predicted by analysts.

“It’s a robust set of numbers, if anything slightly ahead of what people were looking for,” said Morten Singleton, an analyst at Investec Securities in London.

EasyJet surged 18 percent to 368 pence, its biggest advance since June 2003, after Europe’s second-biggest discount airline said annual earnings will beat estimates following a 20 percent surge in business bookings.

Rival Ryanair Holdings Plc rose 4.8 percent to 3.46 euros in Dublin trading while British Airways-owner International Consolidated Airlines Group Plc gained 2.2 percent to 243 pence in London. Thomas Cook, Europe’s second-largest tour operator, advanced 5.9 percent to 72 pence while TUI Travel Plc gained 3.5 percent to 196 pence.

Aviva increased 1.3 percent to 425.4 pence for a fourth day of gains after both the Daily Mail and the Daily Telegraph said Zurich Financial Services AG may be considering an offer for the U.K.’s largest insurer. The newspapers cited unidentified traders.

RM Plc plunged 19 percent to 117 pence after the U.K. provider of education products said earnings may be below previous forecasts.

--Editor: Andrew Rummer

To contact the reporters on this story: Conor Sullivan in London at csullivan39@bloomberg.net; Sarah Jones in London at sjones35@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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