Euro Area Deficit Widens; Nestle Net Triples, BNP Paribas Falls, Swiss Re Up

Arthi Gupta
17 Feb, 2011
New York City

The European indexes traded sideways after euro-zone current account deficit widened and construction output fell in December. German employment exceeded 41 million. Nestl

[R]4:00 PM Frankfurt – The European indexes traded sideways after euro-zone current account deficit widened and construction output fell in December. German employment exceeded 41 million. Nestlé fiscal year net tripled. ABB Ltd quarterly net rose 30%. BNP Paribas net rose 14%.[/R]

U.S. indexes fell after weekly jobless claims rose 25,000 to 410,000 and Asian markets advanced.

Germany is insisting Portugal to seek an international bailout at the earliest, Portuguese newspaper Jornal de Negocios reported on Thursday without citing sources.

Berlin wants Portugal to request for aid before EU leaders make any change in the euro-zone rescue fund in their March summit, the report said.

In Paris CAC 40 Index declined 9.74 or 0.23% to close at 4,141.52 and in Frankfurt DAX Index edged lower 24.13 or 0.33% to close at 7,390.17.

Euro-zone Current Account Deficit Widens, Construction Output Falls

The euro area current account deficit increased to a seasonally adjusted €13.3 billion in December from €10.5 billion in November, the European Central Bank said on Thursday.

Euro-zone construction output fell 1.8% on a monthly basis in December after declining 0.9% in November, as bad weather conditions hit activities, the European Union statistics agency Eurostat said today.

On an annual basis, construction output plunged 12% in December following the revised 6.3% fall in November.

OECD Region Economic Growth Slows

Economic growth in the Organization for Economic Cooperation and Development region slowed to 0.4% on a quarterly basis in the fourth quarter from 0.6% in the previous quarter, data showed today.

German Employment Rises

The number of people in employment in Germany rose 1% from the same period a year earlier to 41.04 million between October and December, statistics office Destatis said on Thursday.

This represents the highest level of employment in a quarter since German reunification and the first time exceeded 41 million.

On a seasonally adjusted quarterly basis, employment rose 0.2% or 98,000, Destatis said.

French Business Start-Ups Slump

The number of new business start-ups in France, excluding self-managed businesses, slumped a seasonally adjusted 24.9% compared to a month earlier in January, according to the statistics office INSEE.

Spain Business Start-Ups Climb

The number of new business start-ups in Spain increased 2.2% to 80,000 last year, the statistics office INE said.

Swiss Investor Confidence Improves

Economic expectations among Swiss investors improved marginally in February, according to results of a monthly survey released by the Centre for European Economic Research (ZEW) and Credit Suisse today.

The CS-ZEW sentiment indicator increased.2 points to minus 17.2 mark indicating a modest improvement in Switzerland''s economic outlook on a six-month horizon.

Portugal PPI Up

Portugal''s producer price inflation rose to 5.7% in January from 4.9% in December, Statistics Portugal said on Thursday.

Luxottica Acquires Stanza and High Tech

Luxottica Group SpA said that it entered into an agreement to acquire Stanza and High Tech, two sunglass specialty retail chains totaling more than 70 stores in Mexico.

The transaction, which is expected to close by the end of the second quarter of 2011, involves a purchase price of about €17 million.

Gainers & Losers

ABB Ltd. fell 2.20% to Sfr22.67 after the power and automation technology company reported fourth quarter total revenues increased 5% to $9.18 billion from $8.76 billion owing mainly to growth in the short- to mid-cycle automation businesses. Net income in the quarter increased 30% to $700 million or 31 cents per share from last year''s $540 million or 24 cents per share.

Annual revenues edged down 0.7% to $31.59 billion from $31.8 billion in the prior year. Full year net income slipped 11.7% to $2.56 billion or $1.12 per share from $2.90 billion or $1.27 per share in the prior year.

Actelion Ltd. gained 1.30% to Sfr54.45 after the Switzerland-based biopharmaceutical company reported total net revenues for the full-year 2010 increased 9% to Sfr1.93 billion from Sfr1.77 billion in the comparable period.

Akzo Nobel N.V. climbed 1.89% to €49.46 after the paints and coatings company reported fourth quarter revenue increased 17.2% to €3.62 billion from €3.09 billion in the comparable period a year ago. Net income from total operations was €162 million or 0.69 euros per share compared with a loss of €60 million or 0.26 euros per share in the previous year.

Axa SA dropped 1.41% to €15.70 after the French insurer reported fiscal year 2010 revenues grew 1% to €90.97 billion from €90.12 billion a year earlier. Net income during the period declined 24% to €2.75 billion or 1.08 euros per share from €3.61 billion last year or 1.56 euros per share a year ago, hurt by exceptional loss related to partial sale of its UK Life operations.

Banco Santander, S.A. surged 4% to $12.48 after the Spanish bank sold shares representing 1.9% of the share capital of Banco Santander, Chile, for a total consideration of $291 million. Currently, Banco Santander holds a 75% stake in the share capital of Banco Santander, Chile.

BNP Paribas Group dipped 0.37% to €58.75 after the French banking company reported fourth quarter revenues rose 2.6% to €10.32 billion from €10.06 billion a year earlier. Net income in the quarter grew 13.6% to €1.55 billion from €1.37 billion last year on strong performance by its three divisions despite a hefty charge related to Axa''s equity investment.

Annual revenues increased 9.2% to €43.88 billion from last year''s €40.19 billion. Net income for the full year 2010 climbed 34.5% to €7.84 billion from €5.83 billion a year ago.

Nestlé S.A. advanced 1.43% to Sfr53.20 after the Swiss food and nutrition products company reported fiscal year 2010 sales rose 2% to Sfr109.72 billion from Sfr107.62 billion reported in the previous year. For fiscal 2010, profit surged 228% to Sfr34.23 billion or 10.12 Swiss francs per share compared with Sfr10.43 billion or 2.91 Swiss francs per share last year, helped by a significant gain from the disposal of its stake in eye care business Alcon.

Pernod Ricard SA plunged 4.01% to €67.80 after the France-based producer and distributor of spirits and wines stated first-half net sales, excluding tax and duties, increased 13% to €4.28 billion from €3.79 billion in the previous year. Net profit in the period rose 11.4% to €685 million from €615 million last year.

Swisscom AG dropped 3.71% to Sfr417.40 after the telecommunication services company reported net revenue for the full year decreased 0.1% to Sfr11.99 billion from Sfr12.0 billion in the comparable period. Net income slipped 7.1% to Sfr1.79 billion or Sfr34.96 per share from Sfr1.92 billion or Sfr37.18 per share a year earlier.

Swiss Re surged 3.57% to Sfr58.00 after the reinsurer stated fourth quarter total revenues declined 7% to $28.84 billion from $30.96 billion a year earlier. Net loss in the quarter was $725 million or $2.12 per share compared to profit of $394 million or $1.15 per share in the prior-year quarter.

Technip SA increased 2.51% to €74.73 after the oil and gas services provider reported fourth quarter revenue improved 22.3% to €1.77 billion from €1.44 billion in the prior year. Net income generated in the quarter was €112.2 million or 1.00 euro per share compared to a net loss of €152.6 million or 1.41 euro per share in the previous year.

Annual revenue slipped 6% to €6.08 billion from €6.46 billion in the previous year. Full year net income increased 145% to €417.6 million or 3.81 euros per share from €170.4 million or 1.59 euros per share in the prior year that was impacted by a provision.