Markets & Finance

European Movers: Financials Plunge amid Crisis


Plus more European stocks making headlines in Monday's market

Financials Europe-wide plunge deep into the red as Lehman files for Chapter 11 bankruptcy protection, AIG (AIG) asks the Fed for US$40 billion in short-term financing and Bank of America (BAC) buys Merrill Lynch (MER) for US$50 billion in an all-share deal. Among the big names getting hammered: AEGON (AEG) (-12.67%), ALLIANZ (AZ) (-7.73%), AVIVA (-7.64%) AXA (AXA) (-12.13%), CS GROUP (CS) (-7.98%), COMMERZBANK (-11.09%), DEUTSCHE BANK (DB) (-8.27%), FORTIS (-11.76%), FRIENDS PROVIDENT (-9.84%), GENERALI (-3.97%), ING (ING) (-7.68%), OLD MUTUAL (-10.3%), PRUDENTIAL (PUK) (-9.3%) RSA INSURANCE (-5.07%), SANTANDER (STD) (-5.29%),UBS (UBS) (-14.63%), and UNICREDIT (-6.74%).

UK

BARCLAYS Down GBP0.46 to GBP3.05... Could still buy parts of Lehman - Traders say that Co. could still pick some of lehman Brother's businesses, specially the investment banking arm. Co. postponed an investor seminar in view of the developments related to Lehman over the weekend and confirmed that it considered a combination with Lehman and did not proceed because it was not possible to conclude a transaction in the best interests of its shareholders. Lehman filed for Chapter 11.

HBOS Down GBP1.01 to GBP1.81... Plunges on funding fears - Shares sink amid worries over funding in the wake of the Lehman's Chapter 11 filing. Co. is poised to sell a share of its stake in rubbish collection firm Biffa to Pi Capital, the networking and investment club for some of Britain's best-known and wealthiest entrepreneurs, The Sunday Telegraph reports.

BARCLAYS Down GBP0.32 to GBP3.19... Walks away from Lehman tie up - Co. has postponed an investor seminar in view of the developments related to Lehman Brothers over the weekend. Co. has confirmed that it considered a combination with Lehman and did not proceed because it was not possible to conclude a transaction in the best interests of its shareholders. Lehman files for Chapter 11.

CABLE & WIRELESS Down GBP0.01 to GBP1.73... To accelerate demerger plans - Co. has accelerated plans to break itself up by announcing the GBP4.5bn demerger of its international business as early as the end of this month, The Sunday Telegraph writes. Says the board is set to meet on 29 September to discuss a plan that is expected to see shareholders receive one share in its UK division and one share in its CW International for every one they own.

SAINSBURY Down GBP0.16 to GBP3.49... Sentiment going into Xmas worse than ever - Chief executive Justin King has admitted that consumer sentiment going into Christmas is worse than it has ever been, the FT writes. Says King notes customer are beginning to change their shopping habits, whilst Co. was trying to respond by adding more products to its Basics range, which is growing at 20% a year as shoppers search for cheaper food.

RANDGOLD RESOURCES Up GBP0.95 to GBP19.95... Up on the rebound Traders note gold stocks are rebounding today due to structural and momentum effects.

FRANCE

MICHELIN Down EUR 2.37 to EUR 47.67... Continental warns on profits - saying they could be squeezed below what it had forecast by sluggish sales in Europe and North America and rising raw material costs.

EDF Down EUR 1.65 to EUR 48.55... British Energy bid this week? - Co. could table an increased bid for British Energy, as early as this week, according to The Sunday Express.

EADS Down EUR 0.56 to EUR 14.94... Further delays expected for A380 - press - According to Le Journal du Dimanche, Co.'s Airbus unit faces further production delays for its A380 aircraft and will deliver between eight and ten of the jets this year instead of the 12 announced. Separately, Co. may also forego participation in a new tender to replace the US Air Force's tanker fleet because of concerns about fairness, Der Spiegel magazine reported.

GERMANY

HANOVER RE Down EUR 2.10 to EUR 25.20... Says has Lehman shares & bonds worth EUR 23m.

BASF Down EUR 1.72 to EUR 36.09... To make offer for Ciba of CHF50 per share. Co. says it seeks at least 66.67% of the Swiss group's stock. For Landsbanki Kepler and WestLB's comments, see Broker Views & News - Germany.

CONTINENTAL Down EUR 0.32 to EUR 73.61... Lowers outlook / Broker action - Co. warned on profits, saying they could be squeezed below what it had forecast by sluggish sales in Europe and North America and rising raw material costs. It expects its EBIT margin will be about 8.5% in 2008. It had aimed for more than 9.3%. Schaeffler's offer for Co. puts a lid on the share price decline. On the broker front, Landsbanki Kepler downgrades to hold from buy, cutting the target to EUR 76.00.

ITALY

ALITALIA To cut 3,000 jobs under deal - Italy's Labour Minister Maurizio Sacconi has said that Co. will cut about 3,000 jobs under a new framework agreement reached overnight with Italy's four main unions. The Italian government has been negotiating throughout the night to find a deal with airline workers to save Co. from folding. Some agreements have been signed, with the exception, though, of key pilot and cabin staff.

ENI Down EUR 0.81 to EUR 20.02... Scaroni sees crude oil prices at US$70/bbl - CEO Paolo Scaroni has said that he sees crude oil prices as low as US$70/bbl as demand softens. Reuters reports that Scaroni also said that Co.'s relations with Russia are still close, despite media talk of risks of a return to Cold War tensions. Separately, Scaroni has told La Repubblica that Co. will not front fuel for Co. without cash payment.

NETHERLANDS

BOSKALIS Down EUR 3.27 to EUR 35.54... Outlines EUR 1.113bn offer for Smit - Co. says it will make a EUR 1.113bn (EUR 62.50/sh) cash offer for Smit Int. The offer represents a 30% premium vs Smit's closing price on 12 September. Co. has invited Smit management to enter into discussion, with the hope of securing its approval of the transaction. The merger would create what Co. dubs 'a world class maritime service provider.'

DSM Up EUR 0.32 to EUR 37.95... Merrill Lynch lifts target to EUR 42 from EUR 36. Keeps neutral recommendation. Upgrades 2008 EPS ests by 15% on the basis of higher vitamin prices.

NORDICS

SAS Up SEK4.50 to SEK59.75... Norway's resistance ease - The Norwegian government's resistance to sell its stake in Co. is easing, Dagens Industri reports.

HANDELSBANKEN Down SEK8.00 to SEK151.00... Holds 6.87% in Lokalbanken i Nordsjaelland - Co. has made a DKK300/sh bid, corresponding to a 135% premium, for the Danish bank Lokalbanken i Nordsjaelland, according to a statement. The board of Lokalbanken unanimously recommend its shareholders to accept the bid. Co. says that it today has acquired 6.87% of the share capital in Lokalbanken i Nordsjaelland.

MOELLER MAERSK Down DKK500.00 to DKK49500.00... Goldman starts with buy and target proce of DKK56000. Says Co. is the most positively exposed of the stocks in the Goldman coverage to global economic realignment and burgeoning industrialisation of the emerging markets. Believes Co. can extract hidden value from its dominance of niches, its long-term contracts and its relatively high-quality earnings, which are highly correlated with oil E&P spend.

SPAIN

COLONIAL Down EUR 0.03 to EUR 0.28... Refinancing deal / POP leaves shareholder pact - Co. holds a press conference in Barcelona today. Co. announces refinancing of EUR 6.5bn debt. Says will sell 33% stake in SFL as well as the stake in FCC and Riofisa. Will propose the AGM the issue of a EUR 1.4bn convertible bond. Following the refinancing news, Banco Popular says that it, La Caixa and others have exited the shareholder pact that was formed to help Co. achieve refinancing. Shareholders holding 9.27% of shares remain in the pact.

SWITZERLAND

CIBA SC Up CHF9.98 to CHF47.98... BASF makes offer - BASF makes offer for Co. of CHF50 per share. The German chemicals and pharma giant seeks at least 66.67% of the stock. Says the financing for the offer is in place.


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