Germany's Xetra-Dax index ended markedly lower. Among German stocks on the move, Degussa (-1.05%) is taking an impairment charge of €830m in fine chemicals, to be a non-cash, one-off item in the third quarter. Deutsche Boerse's (+0.3%) September trading rose 50%, year-over-year. VW (-4.46%) is selling shares directly to Porsche (-0.3%) to raise its stake to the desired 19-20%. Schering (SHR
) (-0.72%) received EU approval for vasovist, its magnetic resonance angiography contrast agent.
Lufthansa (-1.13%), downgraded by ABN Amro Wednesday to sell from hold, aims to lower personnel costs, reports Handelsblatt, as the airline faces tough competition and has to improve its staffing expenses in all areas. The European Commission will not place any obstacles in the way of UniCredito's takeover of HVB (-1.45%), says FAZ. Bilfinger (-8.36%) sees fiscal 2005 net earnings at €65-70 million, against an earlier forecast of more than €70 million, but still has a net target of €100 million by 2007. Also on the broker front, Citigroup initiates coverage of ThyssenKrupp (-0.57%) with a buy, and lifts its target on VW's stock to €59 from €50 as it sticks to buy.
UK stocks finished broadly lower. The negative U.S. sentiment was compounded by news UK consumer confidence fell to the lowest level in 17 months in September, according to the Nationwide survey.
A significant correction in crude oil prices was used as an excuse to sell energy stocks, rather than to go back into affected cyclicals. BP (BP
) (-2.82%) extended Tuesday's fall on concerns about the disruptions from the U.S. hurricanes. Citigroup downgrades the stock today. Royal Dutch Shell (RD
) (-1.41%) was also lower as Ian McCredit, its head of global security, says international terrorism, corruption and local activism are threatening oil operations in many countries.
On the earnings front, investors used a good third quarter update from Michael Page (-2.91%) to take profits. The Aegis (-0.70%) battle heated up, with now WPP (-2.49%) seen teaming up with a U.S. private equity firm, in order to make a bid. Friends Provident (-2.41%) and Wolseley (-3.41%) traded ex-dividend. Whitbread (+2.20%) bucked the downtrend on renewed break-up speculation. Numis Securities thinks a bid is ever more likely and upgrades to buy from hold.
In France, the CAC40 index ended lower, with breadth 24-5 negative. Traders noted a switch out of Total (TOT
) (-3.18%), as the oil price trades below US$64 per barrel, into other defensive plays such as Danone (DA
), Sanofi (SNY
) and Sodexho (SDX
). Arcelor (-1.86%) fell as consultancy firm MEPS reports that increasing domestic steel capacity is undermining steel prices in the Chinese flat products market, while in Japan oversupply has been a problem in recent months.
On the upside, Schneider (+1.88%) performed a technical bounce after clearing the €66.70 level. Neopost (+1.68%) is also a bright spot, as brokers are cheered by another robust performance in the first half and a further improved fiscal 2005 operating margin guidance.