Markets & Finance

Accor Rises on Asian Expansion


From Standard & Poor's European MarketScope

Britain

British Airways was up £0.04 to £2.78, after JP Morgan previewed the company's May traffic statistics, due out this afternoon. The broker said it would be very encouraged if May's premium growth is above 7% and would find this a very positive indicator for its investment thesis.

William Hill was up £0.11 to £5.30, after confirmation that PartyGaming, the world's biggest online poker company, will list in London by the end of the month sparked interest in the bookmaker yesterday, The Guardian reported. Although best known as a traditional high-street bookmaker, William Hill has a booming online business that already accounts for a quarter of group profits and is growing fast. According to analysts, investors after a cheap way to make money from the hype the PartyGaming flotation will undoubtedly generate could do worse than buy William Hill.

Irish drugmaker Elan was up £0.24 to £5.65, after the Guardian newspaper reported that US health officials are investigating a fourth suspected case of a deadly brain disease in a patient taking a multiple sclerosis drug co-developed by the company, The Guardian reports. The US FDA confirmed a report in the Boston Globe that a possible fourth case of the brain infection had been found in a person taking the drug, Tysabri.

Logistics company Exel was £0.13 to £8.65 after Merrill Lynch reinstated coverage with a buy rating and a £9.60 target. The broker said that it estimates the supply chain market is worth £300 billion globally and is growing at 5% to 6% each year. With a global network, the broker said that the company is well positioned to capture these growth opportunities. Meanwhile, Morgan Stanley increased its target to £9.00 from £7.80 and kept its equalweight rating.

Germany

Chipmaker Infineon was up €0.14 to €7.59 after the newspaper Sueddeutsche Zeitung reported that the company plans to sell its smart textiles unit to management for an undisclosed sum. Separately, JP Morgan increased its second-quarter earnings and sales forecast for Intel on rising chip demand from lap top manufacturers. Yesterday the company said it had begun volume production of DRAM chips using 90 nanometre technology at its plant, earlier than.

Airline Lufthansa was up €0.09 to €10.39 as its temporary investment vehicle AirTrust AG now holds 96% of Swiss Airlines share capital, according to the bank Merck Finck.This means that the acquisition now only depends on the approval of anti-trust authorities. In addition, a squeeze-out of remaining Swiss shareholders is possible.

IKWA, the maker of manufacturing and packaging equipment, was up €0.73 to €20.49 after the pnp.de website wrote that the company is reported to be threatening U.S. investor and No. 2 shareholder Guy Wyser-Pratte with legal action following the surprise resignation of CEO Hans Fahr this morning. Wyser-Pratte is accusing the board of manipulating its first-quarter earnings report. Two further supervisory board members are said to have tendered their resignations. Fahr, according to press reports, was facing a challenge to his leadership from Wyser-Pratte who wants the company to refocus the business on robotics while Fahr planned to keep other divisions active.

France

Hotel group Accor was up €0.64 to €38.33 after Michael Issenberg, the company's Asia-Pacific manager, said the company plans to expand in Asia by adding 45 hotels in the region. Issenberg says the tsunami had not affected tourism prospects in the region, nothing that the group's 19 hotels in Thailand remain one of best regional performers with a 75% occupancy rate, the same as fiscal year 2004.

Aerospace giant EADS, parent of Airbus, was €0.17 to €23.95, after the company's unit Eurocopter signed deal with Spain for 45 NH90 helicopters. Financial details remain undisclosed. Bulgaria has also signed a deal worth €320 millon for 18 helicopters as part of its military ugrade. On a negative note, the Japanese airline ANA said it may order $13 billion of Boeing's 777-300ERs to replace its 747 fleet. Separately, Arnaud Lagardere, co-chairman of the company's supervisory board, is setting conditions on the nomination of Gustav Humbert as head of Airbus, reports Les Echos.

Retail group Pinault-Printemps-Redoute, the owner of Gucci, was down €2.65 to €80.65, as it trades ex-dividend today. Yesterday the stock was higher as the bank ING initiated coverage with a buy rating and a target price of €95.

Luxury goods maker Hermes was lower by €1.10 to €163.90, after yesterday's annual general meeting when co-CEO Patrick Thomas said first-quarter growth did not put into question the company's growth outlook for 2005. First-quarter sales were up 5%, while the company has an 8% sales growth target for the year. Yesterday the company was in focus on news that it may cut its 31.5% stake in German camera-maker Leica.


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