UK house prices are back on the drop

House prices in the U.K. appear to have fallen in June for the first time in five months. The reason was attributed to banks scaling back their lending whilst requiring buyers to put down higher percentage deposits.

Figures now show that the average house cost slipped by 0.4 percent to 226,436 pounds from May, when it rose by 2.4 percent.

Governor of the Bank of England Mervyn King announced that whilst the housing market has shown signs of stabilizing, the squeeze on lending may slow the economy’s recovery.

According to a company spokesman, the “essential” value line at Waitrose, the first ever line to be launched by the supermarket chain, is achieving sales at levels well ahead of the group’s projections, with the initial 800 products launched now accounting for 13 per cent of sales.

It has been announced that less than ten per cent of the projects that are part of the more than six hundred billion pound worldwide private infrastructure refurbishments will be ready to commence before the end of 2010, calling into question whether spending on major public projects can provide the ready stimulus that was hoped would push the recession hit economies of the West into life.

Many large projects dependant on private financing, have dried up in recent months, particularly in the UK, where London’s Crossrail line is a particular example.

Not encouraging news especially backed up with the predictions that the U.K.’s business services sector will lose more than three hundred thousand jobs up to 2013. The sectors likely to be hardest hot are construction and real estate.

Bonuses and the Royal Bank of Scotland never seem to be far from the headlines. The bank is expected to announce this week their £9. 6 million pay package for chief executive Stephen Hester. Hester’s salary package has gained support from shareholders as part of a long-term incentive plan put up at a recent meeting chaired by Sir Philip Hampton, chairman of the RBS. As if by coincidence, Hester’s package was approved just a day after his predecessor Sir Fred Goodwin agreed to hand back a third of his self negotiated £16. 6 million pension package

Oil prices were under pressure yesterday with shares in Shell, Europe’s largest oil producer, declining by 4.7 percent to 1,516 pence. The second largest, BP, saw their shares sink 3.8 percent to 478 pence. Crude oil prices have taken a major backward step in the last few days as concern mounts that both Chinese and U.S. gasoline stockpiles are raising due to a reduction in demand during the recession.

Switzerland based Xstrata, the largest exporter of coal used by power plants, proposed a “merger of equals” with the world’s biggest platinum producer Anglo American. The merger, if successful, could trigger fresh consolidation in the mining industry. UK-based Anglo American continued to appear to be less enthousiastic about the deal, whilst warning that talks remained “at a very preliminary stage, placing pressure on Xstrata to add cash to its offer. Shares in Anglo American added 4.6 percent to 1,698 pence.

The 46 games in next season’s English Premier League up for grabs after Setanta went under, will now be broadcast by ESPN. Disney-owned ESPN has bought the rights to two packages of games shown on Saturday teatimes and Monday evenings. Both will be sold to customers through BSkyB.
ESPN will also be showing the 23 games per season that Setanta was due to broadcast from seasons 2010-13 inclusive.

With the oil majors applying overall pressure as crude futures lost the $70 mark, London’s FTSE 100 fell 111.88 points to close on 4234.05, the lowest since April 29. The gauge has still rallied 21 percent from this year’s low on March 3 and is now trading at 30.1 times its companies’ earnings, compared with 17 times profits in the week the rally began in March

The FTSE 250 also continued its downward spiral closing down 159.50 points on 7174.84

Sterling fell back against the major currencies on a difficult day for trading.

Pound/US dollar 1.627
Pound/Euro 1.1759
Pound/Japanese Yen 154.8584
Pound/Swiss Franc 1.7687

On Wall Street, share values fell dramatically with the Dow Jones down 200.72 points on 8339.01, while the NASDAQ lost the bulk of its recent gains down 61.28 points to close on 1766.19

Investigators handling the huge global swindle organised by Bernard Madoff’s have asked for more time to reach a final figure of the amount of money lost as well as the number of investors defrauded. Madoff is due to be sentenced on June 29th.

• Save Time, Money and Space in Over 80 Ways If you're looking for handy gadgets, tools and various items...
• A Simple Secret to Successful Investing. People complicate investing with various concepts, philosophies and principals. There's...
• Would gas prices have to go up another buck? A friend pointed me toward this Washington Post article on...

Tags: Bank of England, Economy, House Prices, Interest Rates, Mervyn King, Money Markets, Mortgages, Royal Bank of Scotland, Stocks and shares