Caja Madrid, Bancaja Merge; Club Med Surges

Arthi Gupta, Mayank Mehta and Sanjay Barot
11 Jun, 2010
New York City

European markets track lower after U.S. retail sales declined in May. Wider euro-zone records current account deficit of

[R]5:15 PM Frankfurt - European markets track lower after U.S. retail sales declined in May. Wider euro-zone records current account deficit of €23.4 billion in the first quarter. Caja Madrid, Bancaja merge to form the biggest bank in Spain. Club Mediterranee SA net profit for the first half soars to €3 million.[/R]

Investors sold stocks in Europe despite an uptrend in commodity prices and the euro and the European Central Bank''s assurance that it would continue buying government bonds.

In London FTSE 100 Index traded lower 8.99 or 0.18% to 5,123.51, in Paris CAC 40 Index decreased 1.51 or 0.04% to close at 3,515.13, in Frankfurt DAX Index traded lower 59.65 or 0.98% to close at 5,996.94. In Zurich trading SMI Index increased 21.46 or 0.34% to close at 6,398.12.

EU27 external current account recorded a deficit of €23.4 billion in the first quarter of 2010, compared with a deficit of €50.6 billion in the same quarter a year ago and a deficit of €9.2 billion in the fourth quarter of 2009.

French annual inflation slowed unexpectedly in May on weak growth in energy prices. Annual inflation slowed to 1.6% in May from 1.7% in April, according to a report issued from the statistical office, Insee today. Core inflation remained flat in May compared to 0.2% in the month a year ago.

The German wholesale price inflation in May accelerated to the highest level since August 2008, driven by strong prices of metal and related products. The wholesale price index rose 6.2% in May compared to a 6% increase recorded in April.

In the UK, output prices rose 5.7% on an annual basis in May, compared with a revised increase of 5.9% in April, according to the Office for National Statistics. Manufacturing production dropped 0.4% in April as opposed to a revised 2.2%.in March.

Spanish savings banks Caja Madrid and Bancaja announced a merger to create the country''s biggest savings bank.

The boards of the two banks approved the merger. The new company will also include five smaller savings banks, with which Caja Madrid had agreed to join operations.

The merged entity was to have total assets of about €340 billion or $408 billion.

Caja Madrid Chairman Rodrigo Rato, a former head of the International Monetary Fund, was expected to chair the new entity, which will allow the participating banks to retain their brands and legal structures.

Caja Madrid is currently Spain''s second-largest savings bank, after La Caixa, while Valencia-based Bancaja ranks fourth.

RPM International Inc., the specialty chemical products company announced on Thursday that its Performance Coatings Group acquired Hummervoll Industribelegg AS, a Norwegian supplier and installer of industrial flooring systems.

Hummervoll, based in Bergen, Norway, has annual sales of about $11 million. The company serves both onshore and offshore markets with its concrete- and epoxy-based flooring systems. Its offshore division provides flooring solutions for oil platforms, barricade desks and emergency escape routes.

Frank Sullivan, RPM chief executive officer said, “The addition of Hummervoll to the RPM Performance Coatings Group presents both top- and bottom-line growth opportunities for RPM. In particular, it broadens our presence in Scandinavia by expanding our overall product line, sales force, installation teams and customer base.”

RPM International Inc. ((RPM)) rose $0.60 or 3.34% and closed Thursday’s regular trading on the NYSE at $18.54 on a volume of 694,255 shares.

Gainers & Losers

BNP Paribas SA increased 4.0% to €45.59.

Club Mediterranee SA surged 8.0% to €12.44. The vacation club operator and travel organizer said first half sales fell 5.6% to €679 million from €719 million a year ago. Net profit for the first half was €3 million compared to net loss of €22 million a year ago.

Fraport AG rose 0.4% to €36.24. Frankfurt Airport registered new record levels for both passengers and airfreight in May. Passenger count jumped 7.1% in May from a year ago.

Gildemeister AG, the manufacturer of cutting machine tools rose 1.6% to €8.75.

Groupe Danone SA fell 0.08% to €43.35 after the yogurt maker today agreed to acquire Medical Nutrition USA, Inc. Under the terms of the agreement, Danone will pay approximately $62 million in cash.

Hochtief AG, the global construction group rose 0.6% to €52.58.

Michelin SCA rose 2.0% to €58.31 after the tiremaker was upgraded at “buy” at Royal Bank of Scotland Group Plc.

JCDecaux SA, the outdoor advertising company rose 2.6% to €20.99.

Man SE, the engineering group rose 0.4% to €68.14.

Rue du Commerce SA, the distributor of electronic and computer products fell 5.0% to €5.70.

SolarWorld AG rose 9.4% to €9.76 after the Solar power technology company was upgraded to “buy” from “hold” at Societe Generale SA and to “buy” from “sell” at DZ Bank.

Suess MicroTec AG, the semiconductor equipment maker rose 0.5% to €4.07.