European Stocks Fall; Allianz Profit Declines

Arthi Gupta
06 Aug, 2010
New York City

The European indexes pare gains after weaker-than-estimated U.S. jobs data. German manufacturing output unexpectedly dipped in June. Greek CPI edged higher in July. Italian GDP expanded 0.4% in the second quarter and industrial production accelerates in June.

[R]4:00 PM Frankfurt – The European indexes pare gains after weaker-than-estimated U.S. jobs data. German manufacturing output unexpectedly dipped in June. Greek CPI edged higher in July. Italian GDP expanded 0.4% in the second quarter and industrial production accelerates in June.[/R]

U.S. stocks trade lower and Asian markets trade sideways. Portugal''s industrial new orders increase in the quarter.

In Paris CAC 40 Index decreased 43.78 or 1.16% to close at 3,720.41 and in Frankfurt DAX Index edged lower 58.19 or 0.92% to close at 6275.39.

German manufacturing output unexpectedly dropped in June as production of intermediate goods and capital goods declined, according to data released by the Federal Ministry of Economics and Technology today.

Manufacturing output fell 0.6% in June as against a revised 2.9% rise in May reflecting the first fall in four months. The annual growth in manufacturing output eased to 10.9% in June from revised 12.9% recorded in May.

Production of intermediate goods fell 1% in June reversing the 3.1% rise in May and capital goods output declined 1.1% in June following a 4.1% increase in May.

Allianz SE, the German financial services firm reported a decline in profit for the second quarter, despite a strong revenue growth.

BP Plc, the oil giant said it completed cementing operations at the damaged Gulf of Mexico well as part of the static kill procedure.

Greek consumer price inflation rose in July, according to the statistics office report released today. The consumer price index rose 5.5% year-on-year in July, faster than a 5.2% growth in June.

Alcoholic beverages and tobacco prices grew 19.2% annually in July, while clothing and footwear prices rose 1.6%. Transport and communication charges rose by 18.4% and 5.4%, respectively. Education costs climbed 3%.

Month-on-month, the CPI dipped 0.5% in July compared to a 0.3% fall in June. Food and non alcoholic beverages prices fell 0.1%, while housing costs grew 0.3% and health charges edged higher 1%.

The Italian economy expanded 0.4% in the second quarter, unchanged from the first three months of the year, according to a preliminary report released from the statistics office Istat today. On an annual basis, gross domestic product increased 1.1% compared to a 0.5% rise recorded in the first quarter.

Italian industrial production grew at a faster pace in June, rising for the fifth month in a row, official data showed today.

Industrial production increased a working day adjusted 8.2% year-on-year in June, faster than May''s 7.3%, the country''s statistics office said today. On a seasonally adjusted basis, industrial production grew 0.6% month-on-month in June, following a 1% gain in May.

Portugal’s industrial new orders increased in the quarter ended in June from the previous year, according to a report by the Statistics Portugal released today.

Industrial new orders climbed 9.9% in the three months ended in June from the previous year, compared to a 2.3% fall in the three months ended in May. Industrial turnover grew 10.5% annually in June as against a 13.3% growth in the previous month.

Gainers & Losers

AirFrance KLM fell 1.47% to €11.40 after the European airline holding company reported a 1.2% increase in July traffic with stable capacity, leading to a 1.1 points rise in load factor to 86.2%. Passenger numbers amounted to 6.9 million.

Total Group load factor for the month of July improved 1.1 points to 86.2% from 85.1% in the previous year.

Allianz SE edged lower 0.32% to €89.87 after the German insurance group reported total revenues for the second quarter climbed 14.4% to €25.4 billion from €22.2 billion in the comparable period. Net income in the quarter fell 45.6% to €1.02 billion or €2.21 from €1.87 billion or €4.13 in the year-ago quarter.

The company added that all three business segments contributed positively to quarterly net income and backed its fiscal 2010 operating profit forecast.

Cegedim SA decreased 0.71% to €55.60 after the technology and services firm specializing in the healthcare field, reported an 8% rise in revenues for the second quarter of 2010.

Dexia SA slumped 5.02% to €3.77 after the Belgian-based bank said net profit in the quarter fell 12% to €248 million, compared with €283 million a year earlier.

Eurazeo SA dropped 1.99% to €50.22 after the French private equity firm said it is extending exclusive talks with Carlyle Group to sell its B&B Hotels business to the U.S. firm by Oct. 12.

Natixis SA rose 2.33% to €4.39 after the lender said net profit in the second quarter was €522 million versus a €819 million loss in the year-ago period.

Umicore NV/SA gained 1.93% to €28.33 after the Belgium-based materials technology group estimates full-year profit before interest, tax and one-time items will be between €315 million and €335 million.