From Standard & Poor's European MarketScope
Major European equity indexes extended their losing streak on Thursday, with persistent concerns over further interest rate tightening weighing on markets.
U.S. import prices showed their highest gain in almost 15 years. Meanwhile, WTI crude oil edged below US$63.50 per barrel, as crude inventories showed a 1 million barrel build. Markets will also look to Thursday's jobless claims report and Friday's retail sales, CPI, and consumer sentiment releases.
In Germany, the Xetra-Dax index finshed solidly lower, with local newsflow determining much of the action in Frankfurt. Utility giants E.on (-0.56%) and RWE (-0.97%) continued their recent slide on news that Germany's environment minister-designate will continue SPD's nuclear power phase-out policy. MAN's (-4.11%) truck division head predicts no growth in the western European truck market next year. Siemens' (-0.3%) business services unit SBS is seen being part sold to Atos and part to Fujitsui Siemens Computers. No confirmation given by any of the companies involved.
Adidas's (+1.47%) sale of Salomon has received approval from EU competition authorities -- with conditions. Stada (-3.99%) has lowered its forecasts for 2005 net income by €10 million to around €50 million -- nearly flat compared to 2004's net earnings of €48.5 million -- due to a write-off linked to an expected marketing delay of a tumor vaccine. Suedzucker's (-4.81%) second quarter net profit fell to €82 million from €84.9 million for the same quarter a year ago, with a flat performance having been predicted.
Fraport (-1.92%) handled 2.6% more passengers in September than a year earlier. Passenger numbers grew to 4.96 million. Cargo passing through Frankfurt Airport rose 9.7% to 162,000 tonnes. Pfleiderer (+4.81%) says there will be no capital injection this year, with the decision postponed to 2006.
The UK's FTSE 100 index ended Thursday's session deep in the red, weighed down by energy and mining stocks, as investors lock in profits after a recent good run.
Uncertainty over copper prices, and a warning from BHP Billiton (BHP) (-4.57%) that its oil & gas production would be lower than anticipated, triggered a wave of selling despite positive broker comments. Antofagasta (-4.81%), Rio Tinto (RTP) (-4.41%), Anglo America (-4.46%) and Xstrata (-4.12%) plunged.
Uncertainty over copper prices offset a broker's target prices upgrade amongst miners today. Antofagasta (-4.75%), Rio Tinto (RTP) (-4.32%), Anglo American (-4.1%), and Xstrata (-4.12%) plunged.
BP (BP) (-1.89%) is said to be pursuing a partnership with Sinopec, China's biggest producer and marketer of refined oil products. Troubled retailer WH Smith (+6.67%) rallied after fiscal year profits beat estimates, though the company says trading conditions are challenging and it remains cautious about consumer spending. DS Smith (-3.8%) shares tumbled after the company warned it was proving difficult to mitigate the extraordinary rise in energy costs and the first half will be significantly lower than the comparable period of last year. Mothercare (+1.95%) also reported a challenging trading environment.
France's CAC40 index ended lower on Thursday with breadth 35-5 negative. Total (TOT) (-1.68%) slipped in line with the energy sector as investors took profits.
Earnings news was in focus as Carrefour (+0.34%) beat expectations, particularly in French hypermarkets. However, analysts warn not to read too much into the numbers, and highlight declines at the supermarket division. ASF (-0.74%) (-0.74%) dipped after reducing fiscal 2005 guidance. Faurecia (-3.85%) was dented after reporting lower-than-expected third quarter sales growth of 1.2%. Saint Gobain (+1.21%) was firm on takeover speculation.
In other markets, negative sentiment loomed over Nordic stocks late in the session, with Norway's OSE almost 4% down amid an oil stock sell-off. Italy's SP/MIB index ended lower on Thursday with breadth 29-10 negative.