Markets & Finance

European Indexes Fall


A roundup of Tuesday's action on major European markets

LONDON

The FTSE 100 closed in the red with US indices trading lower hit by bearish comments on American housing and Intel cutting margin expectations. At home, ADMIRAL (-15.27%) sank despite in-line FY results after the insurer warned 2008 would be much tougher for growth. CABLE & WIRELESS (-11.33%) set new targets for its Europe, Asia and US business (EAU) for the next five years for revenue growth at between 5% and 8% per year. SCHRODERS (+3.89%) jumped after FY07 results beat estimates. CRH (+1.39%) reported a 19% rise in FY PTP, just ahead of forecast. PREMIER FOODS (+7.34%) rallied despite slashing DPS by 45% to 6.5p, as the market was relieved that the group agreed additional banking facilities. JARDINE LLOYD THOMPSON (+5.97%) posted FY results ahead of forecasts. PROVIDENT FINANCIAL (+1.90%) reported FY PTP in line with ests and said has made a good start to 2008. TRAVIS PERKINS (+0.84%) said market growth is slowing as it revealed an 18.7% increase in adjusted PTP for the FY, broadly in line. MICHAEL PAGE (-2.71%) unveiled FY07 revenue of GBP831.6m, ahead of consensus but was mindful of uncertainties surrounding the current global economic outlook. MEGGITT's (+4.06%) FY figures came in at top end of estimates and savings from the K&F deal are expected to exceed target. Good numbers and a positive outlook from WOOD GROUP (-2.39%). However, shares fell after it said it has received no bid approaches.

PARIS

The CAC 40 (-1.41%) ended Tuesday's session mired in the red with Wall Street trading lower after Intel cut its 1Q margin forecast. Of local note, profit taking after yesterday's rally offset Deutsche Bank's upgrade to hold on EADS (-4.31%). SOCGEN (-3.12%) offered to buy out minority shareholders in Rosbank, its Russian unit, for RBL194.09 (US$8.08) per share, Bloomberg reports. Separately, SocGen completed the acquisition of Canadian Wealth Management, which oversees about EUR 450m of funds. RENAULT (-5.1%) expects sales of its low-cost model Logan to increase by 75% in 2008, La Tribune reports, quoting head of Renault's Dacia unit. Separately, Le Figaro reports that Logan's French sales rose by 83% in February. AIR FRANCE-KLM (-1.95%) may raise its EUR 0.35/sh offer for Alitalia if a deal is reached on its conditions, according to Milano Finanza. L'OREAL (-0.47%) is to acquire a 50% stake in Le Club des Createurs de Beaute held by 3 Suisses International. In the wider market, M6 (-3.78%) announced FY07 net attributable profit of EUR 168.60m, down 58.7%; with revenues of EUR 1.356bn, up 5.7%. TECHNIP (+0.48%) won a biodiesel contract from KNM in Malaysia. No financial details were disclosed. SODEXHO (-0.16%) completed the acquisition of Grupo VR's Service Vouchers and Cards activity in Brazil for c.EUR 405m.

FRANKFURT

At the closing bell, Xetra-Dax (-2.17%) found itself thoroughly in the red as Wall Street was also trading much lower, after further warnings from Fed Chairman Bernanke about the US housing market. At home, BAYER (-5.80%) weighed on the index following a decision by a US court to rule against the group's patent for Yasmin, a contraceptive drug. There was good news from TUI (+4.43%), as it reported FY profits up 47%. Earnings from continuing activities rose to EUR 616m. Forced by the pressure of main shareholders, TUI abandoned plans to move its headquarters to Hamburg and merge TUI AG with Hapag Lloyd. THYSSENKRUPP (-0.03%) also made minor gains on unconfirmed rumours that Russian steelmaker Novolipetsk wanted to build up a stake. A ThyssenKrupp spokesperson argued there was nothing to it. PROSIEBEN (-6.37%) posted FY07 in-line sales of EUR 2.7bn, adj EBITDA came in at EUR 661.9m, and adj net income was EUR 272.8m. Carmakers reported their North American sales: DAIMLER's (-3.06%) Mercedes-Benz sales rose 18% y/y in February to 96,600 cars, BMW (-3.32%) fell by 1.8% to 24,190, VW (-0.68%) was up 1.2% to 16,556 and PORSCHE (-0.71%) fell by 11% to 1,841. Weighing on INFINEON (-5.24%) was Intel's lowered 1Q gross margin forecast. DEUTSCHE BANK (-2.18%) raised its share in AIR BERLIN (-2.09%). In broker news, SocGen initiated on POSTBANK (-1.36%) with a buy.

AMSTERDAM

The AEX (-0.51%) fell further in late trade on Tuesday as Wall Street extended losses after Fed chairman Bernanke warned that further declines of home prices were likely. The tech sector was also under pressure as Intel cut its gross margin forecast. Locally, ASML (-3.93%) sank on the back of the news. Also weighing on the stock was a downgrade at Exane to underweight and a target cut by Goldman Sachs. Staples posts a flat 4Q profit. Regarding its bid for CORPORATE EXPRESS (-0.51%) the US office supplies retailer said it has offered a fair price. VEDIOR (+1.15%) bucked the negative trend as Swiss peer Adecco reported 4Q French sales down 1% vs -2% in 3Q07. Adecco's sales in the Benelux were down 2%. AHOLD (+0.69%) also outpeformed ahead of its FY results on Thursday. Elsewhere, financials finished lower. The Dutch FD wrote that consumer claims for misleading and over-priced investment insurance products in the Netherlands could amount to EUR 2bn, following a report of the financial ombudsman. According to the paper, ING (-0.83%) would be one of the hardest hit alongside AEGON (-2.25%), FORTIS (-2.52%) and SNS REAAL (-0.52). DSM (-0.77%) has been ordered by the Dutch government to terminate ammonia transport by rail between Geleen and IJmuiden. In earnings, ORDINA (+5.35%) reported strong FY organic growth rate of 14%.

MILAN

Milan ended Tuesday's session firmly lower as Wall Street trades in the red pulled down by Intel's cut on its profit margin outlook. Back home, Italy's highest administrative appeals court ruled that ALITALIA's (-5.2%) acquisition of airline Volare, had been irregular and that the tender process should be repeated. Daily MF wrote that Air France-KLM may raise its EUR 0.35/sh offer for the carrier if a deal is reached on its conditions. In financial news, BP MILANO's (-2.81%) sold its 10% stake in NordEst Banca to CR di Ferrara for EUR 3.150m in cash. MONTE PASCHI (-2.72%) asked potential bidders for its MPS Asset management unit to present their offers by the end of the month, according to Finanza & Mercati. In other news, CELL THERAPEUTICS (-38.04%) heavily plunged after saying it will issue US$51.7m of new 9% convertible senior notes due 2012. TISCALI (-7.66%) dropped after former CEO Tommaso Pompei sold EUR 1.46m worth of shares in the telco. FIAT's (-6.51%) sales fell 8% to 67,404 units in February. PARMALAT's (+1.94%) board, including CEO Enrico Bondi, aims to be reappointed for a new term at next month's shareholder meeting, according to Il Corriere della Sera. Said that Parmalat's FY07 total group dividend is expected to be between EUR 250m and EUR 260m. On the broker front, Oddo and Credit Suisse cut TELECOM ITALIA's (-1.84%) target.


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