European Markets Slide; Shell Misses Earnings, Benz Auto Sales Up 23%

Nigel Thomas
03 Feb, 2011
New York City

European markets edged lower as crude oil prices rose to a 2-year high. Copper and zinc and aluminum traded higher. Royal Dutch Shell earnings miss dragged markets in Holland and in UK. Mercedes-Benz vehicles in January rose 23% to 82,700.

[R]4:00 PM Frankfurt – European markets edged lower as crude oil prices rose to a 2-year high. Copper and zinc and aluminum traded higher. Royal Dutch Shell earnings miss dragged markets in Holland and in UK. Mercedes-Benz vehicles in January rose 23% to 82,700.[/R]

European indexes traded mixed with a downward bias. Royal Dutch Shell reported lower than expected earnings but Hermes and Vodafone Group earnings were ahead of expectations.

Commodities were in focus for the third day in a row as crude oil, copper and cotton trade higher as violence in Egypt spread to Yemen and Jordan king requested new government.

Total SA declined more than 1.5% and the company said that its natural gas venture in Yemen is operating normal as people carry out mass demonstration against the government.

The euro declined to a dollar and the yen after the ECB President Jean-Claude Trichet at a press conference in Frankfurt said that the central bank is closely watching the rising prices.

He also added that the recent rise in prices are driven by an increase in commodities prices but has not affected “our assessment that price developments will remain in line with price stability” over our target horizon.

Retail trade sales in December decreased 0.6% compared to November in the euro area and fell 0.4% in the wider zone of 27 nations.

Retail sales index fell 0.9% from a year ago month in the euro area and 0.1% in the EU27.

The maker of Mercedes-Benz Daimler Benz AG said January sales increased 23% to 82,700 from 67,000 a year ago. China sales in the month soared 87% 15,000.

Earnings Review

Vodafone Group Plc said fiscal third quarter services revenues on a constant currency basis increased 2.5% to 10.96 billion pounds. Higher revenues in UK, Turkey and turnaround in India helped the telecom carrier in the period.

Revenues increased 32% in Turkey and 17% in India but declined 7.4% in Spain.

The company guided adjusted operating earnings for the full year in the range of 11.8 billion pounds to 12.2 billion pounds.

Royal Dutch Shell Plc said its adjusted earnings in the fourth quarter increased to $4.1 billion. Net income increased to $6.79 billion from $1.96 billion a year ago quarter.

In the year production increased 5.5% to 3.314 million barrels and in the current year the oil explorer is planning to spend at least $25 billion.

Hermes International SCA said sales in the quarter ending in December increased 25% to 736 million euros and full year sales on a constant currency rose to 19% to 2.4 billion euros.

Quarterly sales at its stores increased 28% and wholesale revenue gained 7.6%. Sales in the Americas increased 36% and in Asia Pacific rose 45%.