Bloomberg News

European Stocks Are Little Changed After China GDP Report

January 18, 2013

European stocks were little changed as China’s economy accelerated for the first time in two years and a gauge of U.S. consumer confidence unexpectedly declined.

Rio Tinto Group gained 1.8 percent after Goldman Sachs Group Inc. said the world’s second-biggest mining company may buy back shares. Ophir Energy Plc gained 2.5 percent as Nomura Holdings Inc. raised its recommendation on the stock. Telenet (TNET) Group Holding NV slid 2.6 percent as Liberty Global Inc. said it won’t reopen its bid for the company.

The Stoxx Europe 600 Index retreated 0.1 percent to 287.03 at the close of trading. The gauge lost less than 0.1 percent this week. The equity benchmark climbed to its highest level since February 2011 last week amid speculation that U.S. companies’ earnings would exceed analysts’ estimates.

“The rebound in European equities earlier this month was not surprising, but it’s too much too soon,” said Pierre Mouton, who helps oversee $6 billion as fund manager at Notz Stucki & Cie. in Geneva. “I’m definitely positive on European (SXXP) equities, but the region’s problems have not faded away yet. There might be some disappointments in earnings releases and outlooks, hence some volatility.”

China’s gross domestic product advanced 7.9 percent in the fourth quarter from a year earlier, the National Bureau of Statistics said in Beijing. That compared with the median economist estimate of 7.8 percent in a Bloomberg News survey and growth of 7.4 percent in the third quarter.

Retail Sales

In the U.K., a report from the Office for National Statistics showed that retail sales declined 0.1 percent in December. The median economist estimate in a Bloomberg News survey had called for an increase of 0.2 percent.

In the U.S., the preliminary reading of the Thomson Reuters/University of Michigan’s index of consumer confidence declined to 71.3 this month from 72.9 in December. Economists in a Bloomberg survey had forecast the sentiment gauge would increase to 75.

National benchmark indexes declined in 13 of the 18 western-European markets. The U.K.’s FTSE 100 increased 0.4 percent and France’s CAC 40 retreated 0.1 percent. Germany’s DAX slid 0.4 percent.

Rio Tinto added 1.8 percent to 3,502.5 pence, its biggest gain in more than two weeks, after Goldman Sachs said the commodity producer may return cash to shareholders. The London- listed mining company might seek goodwill following yesterday’s announcement that it will write down $14 billion for its acquisitions of Alcan Inc. and Riversdale Mining Ltd., the brokerage said. Tom Albanese, who oversaw the purchases as chief executive officer, stepped down.

Ophir Advances

Ophir Energy gained 2.5 percent to 540 pence after Nomura raised its recommendation on the shares to buy from reduce. The U.K. oil and gas explorer may make major discoveries in Gabon and Tanzania, analyst Tom Robinson wrote.

Mediaset SpA (MS) jumped 5.8 percent to 2.02 euros after Berenberg Bank raised its price forecast for the shares to 2.60 euros from 1.90 euros and reiterated its buy rating. Analysts led by Sarah Simon said that earnings will rebound in 2014.

The Italian broadcaster has surged 15 percent over the last two days, its biggest rally since 2000. Credit Suisse Group AG upgraded the stock to outperform, the equivalent of buy, from underperform yesterday. Mediaset said in a statement it has no new information about the share-price movement, following a request by market regulator Consob.

Spectris Plc surged 8.3 percent to 2,190 pence, its highest price since at least 1989, after the U.K.’s biggest maker of production-testing gear said comparable sales rose 4 percent in the fourth quarter.

Telenet Bid

Telenet slipped 2.6 percent to 35.80 euros after Liberty Global (LBTYA:US) said it will not reopen its offer of 35 euros a share for the Belgian cable operator. The media company led by John Malone said in September that it would buy the almost 50 percent of Telenet that it doesn’t already own for about 2 billion euros.

Santhera Pharmaceuticals Holding AG, the Swiss developer of an experimental treatment for a rare inherited eye disease, plunged 22 percent to 3.75 francs, the biggest slump since its initial public offering in November 2006. A committee of the European Medicines Agency decided not to approve the Raxone drug, the company said.

The volume of shares traded on the Stoxx 600 today was 6.4 percent lower than the average of the last 30 days, according to data compiled by Bloomberg.

To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net

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


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Companies Mentioned

  • LBTYA
    (Liberty Global PLC)
    • $43.7 USD
    • -0.14
    • -0.32%
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