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UK's Chancellor of the Exchequer Alistair Darling is in China for a series of meetings with Prime Minister Wen Jiabao to improve economic ties. The trip comes as a report announced that China's sovereign fund has accumulated a stake of almost one percent in BP, Britain's largest company. (SOUNDBITE) (English) BRITISH FINANCE MINISTER ALISTAIR DARLING SAYING: "I believe an open market and free trade have been reflected in the U.K.'s opening to its investment including sovereign wealth funds. And we welcome the creation of the Chinese sovereign wealth fund that has potential for investing in our country." Darling brought British ministers, industrialists and bankers on the trip, hoping to capitalize on London's position as a financial centre by encouraging Chinese companies and banks to make greater use of its financial services industry. /// Meanwhile back in the UK, Prime Minister Gordon Brown met with banks and mortgage lenders to encourage them to pass on lower borrowing costs to customers after the Bank of England cut interest rates last week. A survey from the Royal Institute of Chartered Surveyors indicated that house prices are falling across Britain at their steepest rate in three decades. And there is now growing evidence that market turmoil is hurting consumers. Like-for-like sales in British shops fell for the first time in two years and at the quickest rate in almost three years last month, according to the British Retail Consortium. /// But Tesco the world's third-biggest food retailer, is bucking the trend by reporting a record $5.5 billion annual profit and said it had made a strong start to its new financial year, driving up its shares. In a move to knock down a rash of negative speculation about its business in recent weeks, the company disclosed a market-pleasing property deal and revealed that sales at its nascent U.S. venture "Fresh & Easy" were ahead of budget. /// In the markets, The FTSEurofirst 300 was up almost half a percent and European indices extended gains after data from the U.S.and the U.K. showed inflation met expectations in March. Oil set new record highs above $113 a barrel as investors sought to hedge against a battered dollar. And rice also set new record levels leading economists to worry further that biofuels are pushing up food prices. New rules in the UK mean that suppliers must ensure that 2.5 percent of fuel sold at U.K. pumps consists of biofuels, which are made from crops and grasses. The requirement will rise to 5 percent by 2010. Stefanie McIntyre, Reuters COMPANIES MENTIONED: SYMBOLS: