Markets & Finance

On the Move: LVMH, Hypo Real Estate, Kazakhmys


Plus:Ferrovial, Alitalia, Scania and other European companies making headlines Tuesday

From Standard & Poor's European MarketScope

United Kingdom

KAZAKHMYS was down £0.20 to £10.30. Credit Suisse cut its target to £13 from £15, and kept its outperform rating. It said that despite strong production numbers it downgraded 2006 EPS forecast from US$3.39/share to US$2.90 to reflect a provisional pricing adjustment following recent copper price weakness.

Germany

HYPO REAL ESTATE GROUP was down €1.18 to €50.97. Morgan Stanley is reportedly placing 700,000 shares of the company at €50.90 each. On the earnings front, the company expects pretax profit to increase to at least €680 million this year, it said late on Monday after reporting that adjusted earnings before tax rose by a quarter in 2006 to €558 million (before accounting charges and restructuring expenses booked both last year and in 2005).

MUNICH RE was down €1.00 to €122.25. January renewals were in line with risks, the company said, adding that it has acquired some €850 million of new business with good earnings potential.

France

ARCELOR-MITTAL was down €0.37 to €35.13. The company's shares fell amid talk that it could be interested in buying Korean firm POSCO, reported Korean paper Chosun Ilbo.

LVMH was up €2.05 to €81.15. Cheuvreux believes that the company will be able to post good sales and earnings growth, despite weak conditions in Japan. The broker has reduced earnings forecasts by 2% to take account of a weak yen.

Nordics

SKF was up SEK8.50 to SEK138.50. The company posted fourth quarter net sales of SEK13.9 billion, up 9.9%; operating profit of SEK1.86 billion, up 46.7%; operating margin of 13.4% vs. 10%; pretax profit of SEK1.85 billion, up 45%; net profit of SEK1.26 billion, up 46%.

SCANIA was up SEK12.00 to SEK385.50. The company said that with sales of 6,500 engines, 2006 was a record year for Scania Industrial & Marine Engines. The company's strategy for continued growth is aggressive and targets a sales increase of 10,000 engines by 2010.

Netherlands

ASM INTL was up €0.45 to €17.38. Intel (INTC) announced a major breakthrough by successfully manufacturing chips using a new material with a property called high-k and a new combination of metal materials for the transistor gate electrode.

Italy

ALITALIA was up €0.05 to €1.14. The company's shares rallied as news emerged that 11 potential bidders have expressed interest in taking over the company.

AUTOSTRADE was up €0.25 to €22.57. The Italian government may face an EU reprimand Finanza & Mercati wrote that the EU Commission may deliberate on the Italian govt's interference in the planned Autostrade/Abertis merger.

Spain

FERROVIAL was up €1.35 to €76.50. BAA announced the details of its proposal for a second runway at Stansted.

SANTANDER was up €0.03 to €14.47. The company has agreed to sell 44.6 million shares of Portuguese bank BPI (5.87%) to Banco Comercial Portugues for €5.70/share. It expects to make a net capital gain of about €88 million.

Switzerland

SWATCH GROUP was up CHF2.25 to CHF291.50. SocGen upgraded the company to buy from hold and raised its target to CHF330 from CHF250.

Rocio Opazo-Aniotz, Claudia Perotti, Michael Sanderson, Emma Stevenson, Mariella Mongio, Pawan Girglani, Guarav Panchal, Julien Manrique, Isabell Witt, Sara Oscarsson, Ben Marino, John West

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