From Standard & Poor's European MarketScope
Major European indexes ended the week on a down note, losing ground on weaker than expected jobs data from the U.S. and ongoing fears of inflation. RWE posted gains in Germany on news that it will sell its British and American water companies. BSkyB fell on disappointing subscriber data. Steelmakers dropped.
Germany:Xetra-Dax index closed Friday's session in the red. RWE (+1.94%) was the top gainer after it confirmed Friday afternoon that it is selling its UK and U.S. water companies, either by an IPO or as a sale to financial investors, in order to focus on its core electricity and gas business. Adidas (+0.54%) also gained; it placed shares at €143 apiece, raising €648 million to help finance its planned US$3.8 billion acquisition of Reebok. The sportswear group has sold some 4.5 million shares - 10% of its outstanding share capital - to institutional investors. Smaller rival Puma (+2.47%), meanwhile, saw third quarter net income come in at €91.9 million, higher than expected, on quarterly sales also above forecasts at €536.4 million. The group raised its profit forecast, seeing earnings rising by a high single-digit percentage figure.
China's Industrial & Commercial Bank, the Middle Kingdom's largest lender, said it will form an alliance with Deutsche Bank (DB) (+0.03%) to offer investment banking services. Looking ahead, Munich Re (+0.77%) will report third quarter figures on Monday. A poll compiled by Reuters put quarterly net profit after minorities at €437 million against €365 million in third quarter 2004, boosted by asset sales.
France: The CAC 40 index (-0.07%) remained below breakeven with a negative breadth of 32-8 at the close. In Paris, index heavyweight Total (TOT)(+0.37%) provided some support after announcing a better-than-expected third quarter clean net profit. Pharma giant Sanofi (SNY)(+0.6%) bounced back in late trading, lifted by news that its drug Plavix could cut the risk of repetitive heart attack and stroke by 9% if taken with aspirin as an emergency treatment for heart attacks. Arcelor (-1.98%) was one of the index's biggest losers after Spanish peer Acerinox missed forecasts. Australian steel stocks fell overnight on a profit warning from Bluescope.
Axa (AXA) closed the session flat after announcing plans to securitize its French car insurance unit for €200 million in a move to reduce the amount of money it needs to hold to cover risks, La Tribune reported. Euronext (-0.96%) fell further on comments from the London SE's CEO that the UK exchange is not for sale. Vinci's (+1.74%) nine months sales beat estimates. Generale de Sante (+0.84%) announced a 16.5% increase in third quarter sales, boosted by strong numbers from Italy. Meanwhile, small-cap Infogrames (-6.16%) fell after second quarter sales missed forecasts as unit Atari extended losses.
United Kingdom: The FTSE 100 ended lower on Friday. In London, BSkyB (-4.84%) plunged after disappointing subscriber adds in first quarter. British Airways (BAB)(-2.47%) fell after a recent good run. The company raised fiscal year revenue guidance and said it expects some yield improvement this year. The carrier calculated the costs of the Gate Gourmet dispute will be between £35 million-£45 million.
Brewer Scottish & Newcastle (+1.15%) issued a positive nine months statement saying performance is on track with robust results. Cookson (+1.97%) said given current market conditions, overall performance for fiscal year will be slightly better than that achieved in 2004. Baker Greggs (-4.7%) slumped, after reporting a worsening performance in recent weeks. Autonomy (+25.21%) soared after announcing it is to buy Verity (VRTY) for US$500 million. Amvescap (+1.99%) was lifted by M&A talk and an upgrade to buy from UBS.
Elsewhere:Milan ended lower on Friday, as shares beat a retreat in late trading. A handful of SP/MIB stocks managed to hold onto gains. Unicredito (+1.22%) remained firm after JP Morgan added it to its European Focus List. Capitalia (-1.12%), together with Unicredito, has given its okay to support Alitalia's (+2.54%) capital hike, Finanza & Mercati reported. Elsewhere, the truce between airport operator Save and Gemina (-0.02%) has come to an end and the market is speculating that Save could launch a takeover on Gemina, also reported by Finanza & Mercati.
Amsterdam's AEX slipped back into the red in late trade to close marginally lower, with a negative breadth of 15-7. Prepared by Zaida Espana, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online)