European Markets Struggle; Scania, Sandvik, Atlas Copco Down

Bikram Pandey
02 Feb, 2011
New York City

European markets closed mixed with a lower bias after several Scandinavian companies reported earnings misses. Atlas Copco, Scania and Sandvik fell on lower than expected results. BMW said U.S. sales rose 21% and Mercedes-Benz U.S. sales rose 11%.

[R]4:00 PM Frankfurt – European markets closed mixed with a lower bias after several Scandinavian companies reported earnings misses. Atlas Copco, Scania and Sandvik fell on lower than expected results. BMW and Mercedes-Benz said U.S. sales rose more than 11%.[/R]

European markets closed mixed with a downward bias after earnings misses. However, commodities and resource linked stocks were in focus as copper and crude oil continued trade at elevated levels.

Industrial producer price index increased 0.8% in December from November in the euro area and 1.1% in the wider region of EU-27 nations.

DAX index in Frankfurt declined 5.15 to 7,179.12 and CAC-40 index in Paris fell 12.49 or 0.3% to 4,060.13. Swiss market index declined 0.6% but the index in Milan was the lone gainer among the major European markets.

The benchmark index in Stockholm dropped 1.8% after Electrolux AB made cautious comments regarding U.S. sales.

Stock Movers

Atlas Copco AB dropped more than 4.2% to SEK149 after the air compressor maker reported fourth quarter revenues increased 22% to SEK 19,401 million from SEK 15,942 million a prior year.

Net profit in the quarter increased to MSEK 2,916 million or SEK 2.38 per diluted share compared to MSEK 1,700 million or SEK 1.38 per share a year ago.

Electrolux AB dropped as much as 8% after the company said sales increase in North American and in Europe are going to be modest and analysts cited slower than expected demand as home construction lag.

Sandvik AB declined more than 4% to SEK117.80 after it reported lower than expected earnings. The tool maker returned to profit but fell short of estimates.

Sandvik fourth quarter total revenues surged 28% to SEK23.2 billion from SEK18.2 billion a prior year. Profit in the quarter increased to SEK2.1 billion or SEK1.76 per diluted share compared to loss of SEK132 million or 11 kronor cents per share a year ago.

Scania AB fell 6% after the Swedish conglomerate said that first quarter results may be affected on strong kronor.

Fortum Oyj declined 3.3% to 22.32 euros after the Finland’s largest utility reported fourth quarter net income of 231 million euros. Analysts were looking for at least 290 million euros.

Daimler AG declined 1.9% to 52.49 euros after its unit Mercedes-Benz U.S. sales rose 11% to 16,398 units. Bayerische Motoren Werke AG increased 0.14% to 56.65 euros after its U.S. sales increased 21% to 15,905 units.