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|  | JANUARY 4, 2006
 WORLD EQUITY WATCH European Indexes Close HigherBrokers provided newsflow in the major markets, as the indexes climbed with Wall StreetFrom Standard & Poor's European MarketScope The European indexes were firm echoing trade in New York. Wall Street built on Tuesday's gains amid suggestions that interest rate hikes are nearing an end. The primary data was US factory orders which rose +2.5% in November, in line with estimates. Germany:The Xetra-Dax index closed over 1% higher after building on earlier gains. In the Dax blue chip index, Siemens (SI )(+3.33%) and Man (+4.57%) topped the gainers as investors took to late cyclical stocks, according to a UBS analyst. The same analyst today coincidentally lifted the price target on Siemens. Elsewhere, BASF (BF )(-1.6%) fell as S&P and Fitch put the credit ratings of the firm on negative watch after the company bid for Engelhard (EC ). Allianz (AZ )(+2.42%) edged up after board member Joachim Faber told Boersen-Zeitung that the trend that saw operating profit improve at the asset management unit is expected to continue. Meanwhile, Handelsblatt newspaper reported that Allianz unit Dresdner Bank is selling loan facilities via a new sales platform. Separately, Handelsblatt said the German cartel office is likely to impose severe conditions if Sixt (-0.35%) acquires Volkswagen's (-0.87%) Europcar division as the two groups combined would have a market share of 45% in the car rental market. Schering (+0.09%) (SHR ) came off earlier lows as the FDA approved its hormone therapy patch, Climara Pro, for the prevention of postmenopausal osteoporosis. United Kingdom: The FTSE 100 index (+0.58%) ended the session higher on Wednesday supported by pharmaceuticals and Next. In London, retailer Next (+10.44%) soared after saying it expects fiscal year profits to be above market expectations, in the range between £435 million and £450 million. The group posted a 3.2% fall in retail like-for-like, an improvement compared with previous quarters. Insurer Prudential (PUK )(+2.32%) rose on speculation that it could be a takeover target. Aviva (+2.54%) and Legal & General (+2.22%) also advanced. On the downside, tobacco group Gallaher (-1.41%) fell on news of a placement by ABN Amro. HBOS (-1.66%) suffered after a downgrade from Goldman Sachs as the broker argued there was little upside potential on the shares. CRH (+1.34%) reported a strong performance in 2005 and said it expects fiscal year pretax profit to exceed €1.25 billion. Man Group (+0.98%) said the NAV of Man AHL Diversified Futures was US$27.31 at the close of Jan. 2, +16.2% over the last 12 months, -0.36% in the last week. Intertek (-2.58%) announced its pre-shipment inspection contract with Nigeria has been terminated with a £2 million provision required in the 2005 accounts. France: The CAC 40 index (+1.26%) stormed higher to finish the day at a new high of 4,837. In Paris, Total (TOT )(-0.32%) fell on a Morgan Stanley downgrade to underweight from equal-weight. Schneider (+3.38%) was the day's largest gainer; CSFB published a report on themes for 2006, and highlighted the stock as a top "corporate spend" play. Arcelor (+3.15%) also rose; as the market waited to see if it will raise its bid for Dofasco following ThyssenKrupp's improved offer. Outside of the index, Alstom (+8.35%) was the day's star as it sold its loss-making shipbuilding business to Aker. The Norwegian group will take a 75% stake in the unit for €50 million, with Alstom owning the remainder until 2010. Elsewhere, Renault (-1.18%) traded in the red after unveiling fiscal year global sales up a mere 1.7%, with Europe down 4.1%. The brokers initiated coverage of EdF (+3.12%) with mixed ratings: Ixis a reduce, Deutsche Bank a buy, while UBS had a neutral stance. Essilor (-1.90%) denied speculation that it was interested in Novartis (NVS ) unit CIBA Vision. Elsewhere: Nordic indexes were higher across the board. In Norway oil stocks climbed. Finnish cell phone giant Nokia (NOK )(+0.97%) remained higher on hopes set in Chinese and Indian growth. The company also announced new Bluetooth headsets. Swedish peer Ericsson (+0.36%) was less buoyant as investors digested the Marconi consolidation. Spain's Ibex 35 ended Wednesday's session in the black. Utilities were once more at the fore as Spain's Socialist government indicated it would overrule the recommendations of the competition board and approve Gas Natural's (+0.72%) takeover of Endesa (+0.83%), the FT reported. However, Gas Natural may be obliged to sweeten the deal. Arcelor (+3.63%) was among the leading gainers after Thyssen yesterday upped its bid for Dofasco. Nordic markets ended higher across the board.  Prepared by Zaida Espana, Valerie Vidal, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, Julien Manrique, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online) All of the views expressed in this research report accurately reflect the research analyst's personal views regarding any and all of the subject securities or issuers. No part of analyst compensation was, is or will be, directly or indirectly related to the specific recommendations or views expressed in this research report. Standard & Poor's Regulatory Disclosure Any advice, analysis, or recommendations contained in articles labeled "Insight from Standard & Poor's" reflect the views of Standard & Poor's, which operates separately from and independently of BusinessWeek Online. It is possible that BWOL may from time to time publish information that is not consistent with advice, analysis, or recommendations that are published by Standard & Poor's. Standard & Poor's and BusinessWeek Online are each units of The McGraw-Hill Companies, Inc.
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