European Air Travel Disruption; Stocks Drop

Mayank Mehta
16 Apr, 2010
New York City

Greek bond yields rose to pre-bailout level as the EU finance ministers meet to set bailout loan conditions in Madrid. Airlines are expected to los one billion dollars as volcanic ash disrupt air travel in Northern Europe. Carrefour sales climb 5.5% as market in France improves.

[R]7:00 PM Frankfurt, Paris; 1:00 PM New York – Greek bond yields rose to pre-bailout level as the EU finance ministers meet to set bailout loan conditions in Madrid. Airlines are expected to los one billion dollars as volcanic ash disrupt air travel in Northern Europe. Carrefour sales climb 5.5% as market in France improves.[/R]

Preliminary estimate of the Euro zone trade surplus in February with rest of the world was €2.6 billion euro, compared with a deficit of €1.2 billion a year ago month. First estimate for the wider EU trade balance in February was €6.0 billion euro deficit.

Greek 10-year bond yields rose to 7.4%, close to pre-bailout 7.5% as EU finance ministers negotiate conditions for loans to Greece in Madrid today. The IMF is expected to ask for more pension payment cuts for civil servants and trim government bureaucracy.

In London FTSE 100 Index closed lower 83.47 or 1.43% to 5,741.54, in Paris CAC 40 Index decreased83.96 or 2.07% to close at 3,981.69, in Frankfurt DAX index lower 109.67 or 1.74% to close at 6,181.78. In Zurich trading SMI decreased 98.42 or 1.41% to close at 6,869.14.

Airlines around world are projecting a loss of one billion dollar loss on the account of volcanic ash cloud related travel disruption according to the Center for Asia Pacific Aviation. Finnair Oyj said that the carrier stands to lose 2 million euros a day.

Deutsche Lufthansa, Air France-KLM Group, SAS AB, Finnair, British Air and Virgin Air are only few of the airlines that have canceled most of their flights today. Eurocontrol, the air control agency in Brussels said that nearly 60% of daily 28,000 flights in the Northern Europe were canceled.

UK air traffic control authority closed all British airspace Thursday and said flights are not likely to resume till Saturday.

Airports from Ireland to Czech Republic are closed on Friday.

Gainers & Losers

Air France-KLM decreased 1.7% to €12.66 after the carrier has cancelled all flights in and out of Paris on Friday morning because of the volcanic ash cloud from Iceland. Airports in the UK, France Germany, Scandinavia and western Russia maybe closed till Monday.

Fraport AG declined 2.3% to €40.51 after Frankfurt airport remained closed for the day and may be closed till Monday. Airlines around world are projecting a loss of one billion dollar loss on the account of volcanic ash cloud related travel disruption according to the Center for Asia Pacific Aviation.

ArcelorMittal the global steel producer declined 2.2% to €45.69.

Carrefour SA rose 2.9% to €38.98 after the retailer sales rose 5.5% in the first quarter, lifted by an improvement in business in France. Sales for the first quarter were €23.96 billion ($32.72 billion), compared with €22.72 billion in the year ago quarter.

Compagnie de Saint-Gobain SA fell 0.5% to €37.36 after the supplier of building materials extended the debt maturity and reduced the cost of a €2.44 billion bank loan facility.

Continental AG added 2.5% to €39.84 after the auto-parts maker was rated “buy” in new coverage at UBS.

Mercialys SA the real-estate investment trust fell 0.7% to €25.65.

Nordex AG climbed 2% to €9.48 after the German maker of wind turbines was upgraded to “buy” from “hold” at Commerzbank AG.

Pierre & Vacances SA the holiday-apartment company fell 0.3% to €59.80.

Renault SA fell 0.03% to €35.16 after the carmaker registrations of new passenger cars in the European Union rose 10.8% to 1.64 million vehicles in March from the same month a year ago, the European Automobile Manufacturers'' Association said Friday.

SKF AB jumped 6.7% to Skr142.80 after it reported better than expected first quarter earnings.

ThyssenKrupp AG the technology company fell 0.7% to €26.34.

Telefonaktiebolaget LM Ericsson the multimedia solutions and telecom services provider said first quarter revenues fell 19% to €1.41 billion from €1.74 billion a year ago. Net profit for the quarter was €21 million compared to net loss of €293 million a year ago.

Veolia Environnement fell 2.1% to €25.64 after the company announced that it has signed a long-term strategic partnership agreement with Quatari Diar. As part of the agreement Quatari Diar will acquire a 5% stake in the company, and will join the company''s board.

DAX Index Movers

Deutsche Bank AG led the decliners in the DAX index of 5.47%, followed by Commerzbank AG of 2.87%, in Deutsche Lufthansa AG of 2.73, in Salzgitter AG of 2.69%, and in Infineon Technologies AG of 2.43%.

Volkswagen AG led gainers in the DAX index with a rise of 0.94%, followed by increase in BMW AG of 0.81%, in Bayer AG of 0.31%, in Fresenius Medical Care AG & Co. KGaA of 0.31%, and in Metro AG of 0.07%.

CAC-40 Index Movers

Technip led the decliners in the CAC-40 index of 3.90%, in ArcelorMittal of 3.88%, in Suez Environnement SA of 3.52%, in Credit Agricole SA of 3.36% and in BNP Paribas SA of 3.25%.

Lafarge S.A. gainers in the CAC-40 index with a rise of 2.14%, in Carrefour SA of 1.44%, in Alstom SA of 0.24%.