Markets & Finance

European Indexes Finish Mixed


Major European equity indexes ended mixed Monday. Investors eyed a mixed U.S. performance as the Dow Industrials were up 0.40% but the Nasdaq was down 0.10%. Positive news from GM (GM) and Altria (MO) pleased the markets, but rising crude oil prices weighed on Wall Street sentiment. WTI crude oil futures were up more than US$1 per barrel on fears that tropical storm Wilma might hit already weakened Gulf of Mexico oil rigs.

Germany's Xetra-Dax index erased gains in late trading to end just above breakeven Monday. Among German companies in the news, DaimlerChrysler (DCX) (+1.69%) has rejected MAN's (+0.31%) bid for its diesel engine maker MTU because the offer is too low. MAN, meanwhile, confirmed its forecasts for the full year in Frankfurter Allgemeine Sonntagszeitung. Porsche (+0.99%) aims to more than double its dealerships by the end of next year, according to FAZ.

In the financial sector, Allianz (AZ) (+0.28%) said Hurricane Rita and other storms have not undermined its profits target for 2005. Deutsche Bank (DB) (+0.67%) is leading a consortium to buy a 14% stake in China's Huaxia Bank for US$329 million, which analysts reportedly consider overpriced. Meanwhile, Deutsche Bank aims to triple premiums in India in the next two years and may enter the banking industry to get a bigger slice of the financial services market in the world's second most populous country.

According to Focus magazine, ThyssenKrupp (+1.32%) may be about to sell part or all of its automotive unit.

In the UK Monday, the FTSE 100 index closed modestly higher, lifted by oil stocks BP (+2.61%) and Royal Dutch Shell (+0.83%). Man Group (+1.56%) says it is not currently in discussions with Refco or its advisers regarding an acquisition and it has no direct financial exposure to the troubled group. Easynet confirms it has received an approach. BSkyB (+0.09%) has been mentioned as a potential buyer. Wolseley (-0.09%) is said to be in talks to buy Swedish rival Ahlsell. Raphoe said it will not launch a bid for Rentokil (+1.31%). Rentokil's board in turn said it remains strongly supportive of the current management.

Elan (ELN) (+2.72%) jumped after unveiling positive results from safety valuation of Tysabri. In the media front, Aegis (-4.15%) plummeted after Publicis confirmed it has decided not to bid. WPP (-0.91%) announced it is considering making an offer. GCap (+7.46%) rallied, on reports Cinven is preparing a £700 million bid. EMI (-0.45%) expects first half pretax profit to rise by 9%, and says it has gained market share in the half and is on track to deliver in line with its expectations for the full fiscal year.

The CAC 40 (+0.16%) index in France lost traction towards the end of trading as Wall Street was mixed. Breadth was negative at 26-14, with the index saved by Total (TOT) (+3.37%), which moved higher on the strength in crude prices. Elsewhere, Altran (+17.45%) jumped after posting 2005 first half operating profit up 60%, with an operating margin of 5.8%.

The media sector shared center stage Monday. Vincent Bollore, owner of Bollore Investissement (+3.96%), announced on Saturday that he has increased his stake in UK's Aegis to 17.38% from 15.43%. Meanwhile, Publicis (+2.96%) says it is not in the best interests of its shareholders to make an offer for Aegis Group. Vallourec (+3.64%) rallied as UBS initiated coverage with a buy and €520 target. Investors eyed Alstom (+0.3%) as London's Transport Commissioner may be seeking to terminate the contract for maintenance of underground trains following problems affecting the Northern Line, according to the FT. Sanofi (SNY) (-0.51%) was down as Jean-Francois Dehecq fails to disclose the name of his chosen successor. Casino (+1.02%) made further gains on news it has sold 13 warehouses to Morgan Stanley for €201.5 million, allowing it to reduce debt by €188 million.

Elsewhere, Italy's SP/MIB index ended slightly higher on Monday, while Scandinavian Scandinavian indexes closed mostly higher, with Stockholm's OMX the exception.


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