Markets & Finance

European Indexes Finish Higher


Major market benchmarks each gained over 1% Tuesday

London

The FTSE 100 ended Tuesday's session with strong gains, as the mining and banking sectors led the way. Oil prices remained in focus on reports that OPEC is close to agreeing a small increase in its production at its Vienna meeting being held today. Locally, DSG (-0.2%) was a rare sore spot after a Morgan Stanley downgrade. NEXT (+4.25%) rose after interim pretax profit topped consensus. CAIRN ENERGY (+3.47%) unveiled a first half pretax profit of US$1.523 billion. The group said it will start a potentially high impact exploration drilling campaign in Bangladesh. WOLSELEY (+3.83%) announced a series of acquisitions. TESCO (+4.39%) advanced on the back of a broker upgrade. In the broader market, COBHAM (-5.27%) sales missed forecasts. PROVIDENT FINANCIAL (+0.52%) unveiled a 19.4% rise in first half profit. FRENCH CONNECTION's (unch.) first half loss narrowed to £2.5 million but the clothing retailer sees a challenging second half. JJB SPORTS (-14.2%) received a red card from investors after warning first half profit will fall below expectations. REDROW (+2.8%) reported flat fiscal profits and said forward sales are up 6.4%. COMPUTACENTER's (+11.25%) interim figures beat consensus. SKYEPHARMA (+1.56%) was boosted by new hopes for its asthma drug.

Paris

The CAC 40 (+1.72%) closed in firmly positive territory with Wall Street trading in fine fettle. At home, TOTAL (+1.54%) adds 10 index points. WTI was trading high at US$77.53/bbl with an OPEC meeting in session. Elsewhere, the French government is exploring the future of its nuclear holdings, Les Echos reported. Said that some kind of coming-together between AREVA (+2.62%) and today's standout percentage performer ALSTOM (+6.47%) seems preferred by the government. The possibility of a grand tie-up between Areva, Alstom and BOUYGUES (+3.41%) has long been talked up. In related news, BNP PARIBAS (+1.6%) has sold its 6.5% stake in Bouygues Telecom to Bouygues for €441 million. SOCGEN (+1.67%) gained after reaffirming fiscal 2007-08 guidance yesterday. WestLB also upgraded the bank to buy. RENAULT (+3.84%) yesterday unveiled 10 new models, including the Sandero (based on the low-cost Logan frame), at the Frankfurt auto show. Reportedly said global July-August sales were up 11.3%. In late session, an unsubstantiated rumour emerged that MICHELIN (+2.53%) could up guidance tomorrow. ARCELOR MITTAL (+3.35%) targets 20% increased shipments between 2006-2012. A PPR (+1.98%) unit has bought US United Retail Group for US$198.9 million. Among pharmas, SANOFI (+1.36%) has agreed to pay US$193 million to settle a US federal fraud suit. Wider-market, NICOX (+3.53) reported promising clinical results for its TPI-1020 drug.

Frankfurt

Xetra-Dax (+1.12%) ended comfortably above breakeven, tracking gains on Wall Street, which was upbeat after solid sales from McDonalds as well as the US trade deficit narrowing. In Berlin, Fed chief Bernanke made no comments regarding its interest rate policy, according to Reuters. Comments emanating from the Frankfurt auto show jamboree have so far been cautiously bullish. PORSCHE (+3.33%) was the best performer among auto stocks as it reported fiscal full-year sales of €7.4 billion. Regarding VW (unch), Porsche said it has enough stock options to significantly raise its stake, but plans no capital increase in the foreseeable future. BMW (+1.99%) said it is striving for 2007 operating profit above its 2006 result. DAIMLER (+1.0%) said it sees a good chance for a rise in its dividend payment. MAN's (+1.31%) commercial vehicles unit saw a 38% rise in order intake in the first eight months of the year. Autos apart, MERCK (+5.67%) rallied as a Phase III Erbitux study showed increases in overall survival in first-line treatment of non-small cell lung cancer. AIR BERLIN (+6.84%) gained altitude as Deutsche Bank upped its stake to 16.36%, stressing this is purely financial, not strategic - thus encouraging takeover speculation again.


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