London To Become Hub For China’s Yuan

View gallery A man walks past the London Stock Exchange, in central London, on September 22, 2011 (AFP Photo/Facundo Arrizabalaga) London (AFP) – London shares edged higher on Thursday as BSkyB surged after the satellite television broadcaster’s results for its latest quarter. The benchmark FTSE 100 index added 4.57 points or 0.07 percent to close at 6,576.16 points. “Global markets were lifeless today as the much expected agreement between officials in the US to avoid a default failed to ignite much optimism in equities,” said Shavaz Dhalla, a financial trader at Spreadex.” “Furthermore, since most investors were expecting a deal to be reached, albeit earlier then yesterday, then there really isnat much of an excuse to be diving back into equities,” Dhalla said. However, BSkyB shares soared 7.06 percent to 940 pence as the company 39-percent owned by Rupert Murdoch’s News Corp announced higher revenues and expressed confidence about the rest of the year. Profits after taxation fell almost 12 percent to A193 million, hit by heavy investment in new services and a more expensive broadcasting deal to screen English Premier League football matches. But revenues grew 7 percent to A1.843 billion in its first quarter to end-September, aided by swelling subscriber numbers. “While the consumer environment remains challenging, we are well placed as we execute a strong set of plans for the rest of the year,” said chief executive Jeremy Darroch. Terrestrial broadcaster ITV benefitted from BSkyB’s positive comments, putting on 2.63 percent to 195.10 pence. Brewer SABMiller climbed 4.18 percent to 3,167 pence and budget airline easyJet gained 3.83 percent to 1,328 pence. Engineering group Weir led the fallers, dropping 2.99 percent to 2,268 pence, while building supplies distributor CRH shed 2.59 percent to 1,539 pence and inspection and verification specialist Intertek lost 2.55 percent to 3,210 pence. On the currency markets, the pound strengthened to $1.6156 at 5:26 pm from $1.5900 on Wednesday evening and to 1.1825 euros from 1.1794 euros the night before. Investment & Company Information

London shares close higher as BSkyB surges

The announcement came in the middle of a five-day British trade mission to China led by finance minister George Osborne. On Monday, Britain unveiled simpler visa rules aimed at luring Chinese tourists. Osborne’s trip marks a return to normal exchanges after Beijing derailed a planned visit by Prime Minister David Cameron in April in retaliation for the British leader having met the Dalai Lama, the exiled Tibetan spiritual leader. Investors in London will be allowed to apply for licenses to invest yuan directly into China, Osborne announced. He said the Chinese central bank set an initial quota for London of 80 billion yuan ($12.7 billion). Tuesday’s announcement put London ahead in the race by global financial centers to gain a share of yuan-denominated business as Beijing gradually expands use of its currency for trade and investment. Hong Kong was the first financial center outside mainland China where trading of yuan was authorized. London banks have traded yuan since early last year. “Now London is a major global offshore center for the trading of the Chinese currency,” Osborne told reporters. Britain and China signed an agreement in June to have their central banks swap 200 billion yuan for 20 billion pounds. The European Central Bank and Beijing announced a similar agreement this month to swap 350 billion yuan for 45 billion euros. That suggested Frankfurt also might be in to become a center for business denominated in yuan.