European Indexes Decline; Poland, Holland, Sweden Show Gains

Arthi Gupta
01 Nov, 2010
New York City

The European indexes traded sideways ahead of the rate decision in the U.S tomorrow. The IMF estimated economy in Poland to expand 3.5%. Swedish manufacturing growth slackened and Swiss industrial activity declined in October. ICBC agreed to buy U.S. brokerage firm from BNP Paribas.

[R]4:00 PM Frankfurt – The European indexes traded sideways ahead of the rate decision in the U.S tomorrow. The IMF estimated economy in Poland to expand 3.5%. Swedish manufacturing growth slackened and Swiss industrial activity declined in October. ICBC agreed to buy U.S. brokerage firm from BNP Paribas.[/R]

European stocks traded higher in the morning after China reported robust manufacturing expansion. The news lifted commodities prices and lifted resource stocks. U.S. stocks advanced after mixed personal income and spending data and Asian markets rose on strong manufacturing data from China.

The Czech Republic manufacturing growth rose in October and Dutch manufacturing surged. Danish retail sales declined in September but manufacturing index rose in October.

In Paris CAC 40 Index decreased 5.76 or 0.15% to close at 3,827.74 and in Frankfurt DAX Index edged higher 17.64 or 0.27% to close at 6,619.01.

The International Monetary Fund said on Friday that the Polish economy may grow 3.5% this year as strong employment growth boosts consumption. The lender further said increase in private investment supported by improved corporate profitability and growth in EU-funded public investment will also underpin Polish economic expansion.

In 2011, the economy is projected to grow at a rate of 3.8% to 4%, though external economic conditions posed downside risks.

Sweden''s manufacturing sector growth slowed in October as rate of growth in production and new orders eased, according to results of a survey released today. The Purchasing Managers'' Index dropped to 61.8 in October from 63.3 in September, Swedbank and Swedish National Association of Purchasing and Logistics said.

The index for new orders fell to 63 in October from 65.8 in September. New orders from domestic market grew at a slower pace, while export orders rose marginally. The index for production fell to 63.5 in October from 67.4 in September.

Switzerland''s SVME Purchasing Managers'' Index dropped to 59.2 in October from 59.7 in September, a joint report by the SVME Association of Purchasing and Materials Management and Credit Suisse showed today.

Czech manufacturing growth slowed slightly in October, survey data showed today. Markit Economics said the HSBC manufacturing purchasing managers'' index was at a seasonally adjusted 57.2 in October.

Czech manufacturing output rose for the 15th straight month in October, led by a marked inflow of new work from domestic markets. New export business increased at the slowest rate this year.

In another report, data from the Czech Finance Ministry showed that the budget gap during the January to September period reduced to CZK 96.7 billion from last year''s deficit of CZK 138 billion. Czech budget balance showed a surplus of CZK 2.8 billion in October compared to a CZK 50.8 billion deficit last year, narrowing the year-to-date budget deficit by CZK 41.4 billion.

Dutch manufacturing growth accelerated sharply in October led by higher external demand, according to a survey data released today. Markit Economics said that the NEVI manufacturing purchasing managers'' index came in at a seasonally adjusted 55.4 in October, from 52.9 in September.

Norwegian manufacturing activity improved largely due to the increase in new orders, according to a survey by Fokus Bank and the Norwegian Association for Purchasing and Logistics. The seasonally adjusted Purchasing Managers Index rose to 54.2 in October, from 53.1 in September.

Norway''s C2 credit indicator increased 4.8% annually in September, compared to a 4.6% growth in August, the Statistics Norway said today. The general public''s gross domestic debt C2 rose to NOK 3.55 trillion at the end of September, from NOK 3.53 trillion in August.

Norwegian money supply growth was 3.8% on an annual basis at the end of September, down from 4.3% rise at the end-August, the Statistics Norway said today. The decrease in the M2 growth came from other financial enterprises. The broad monetary aggregate M2 was NOK 1.57 trillion by end-September, down from NOK 1.58 billion in August.

Danish retail sales declined 0.4% on a monthly basis in September after adjusting to seasonal variations, following a downwardly revised 0.3% growth in August, Statistics Denmark said today. Clothing sales fell 0.4% and trade in other consumer goods declined 0.7% in September.

Denmark''s manufacturing activity increased at the strongest pace in nine months in October, according to data from the Purchasing and Logistics Forum/DILF published today. The headline seasonally adjusted purchasing managers’ index rose to 55.2 in October from 51.3 in September.

The index for new orders rose to 56.4 in October from 50.9 in September. The production index advanced to 59.5 in October from 55.5 in September.

Industrial and Commercial Bank of China Ltd. is venturing into the broker-dealer business by the acquisition of the Prime Dealer Services unit of Fortis Securities from BNP Paribas SA, the Wall Street Journal reported on Sunday.

The WSJ report quoted Joseph Spillane, former chief executive of Fortis Securities and now CEO of ICBC Financial Services, as saying that the unit will focus on clearing bond purchases first and will later examine other expansion opportunities. Spillane predicted that the business would bring in about $15 million in annual profits for ICBC. It currently has a $10 billion balance sheet.

Gainers & Losers

BG Group Plc gained 0.91% to $40.97 after the British energy firm announced that it will immediately begin the development and construction of the US$15 billion Queensland Curtis Liquefied Natural Gas project near Gladstone in Australia''s Queensland state.

Bayer AG rose 1.85% to €54.61 after the drugmaker cited preliminary results that its Xarelto blood thinner pill was as good as warfarin at preventing the risk of strokes in patients with an irregular heartbeat that is common among the elderly.

Logitech International S.A. increased 0.38% to Sfr18.73 after the provider of personal peripherals for computers released Logitech Wireless Solar Keyboard K750.

Ryanair Holdings PLC slumped 3.53% to €3.99 after the low-cost airline reported second quarter total operating revenues rose 29% to €1.28 billion from €992.1 million in the same period last year. Net profit in the quarter rose 32% to €330.3 million or 21.96 cents per share, compared with net profit of €250.5 million or 16.90 cents per share last year.

Serco Group plc plunged 3.83% to 590.50 pence after the outsourcing services provider was asked by the government to lower prices, reportedly withdrew letters requesting rebates from suppliers.