European Indexes Trade Sideways; Nestle Sales Decline 9%

Arthi Gupta
15 Apr, 2011
New York City

The European indexes traded mixed after inflation rose more than estimated in March to 2.7%. Greece is likely to announce new austerity measures. Nestle first quarter sales declined 9% impacted by a stronger domestic currency.

[R]2:00 PM Frankfurt – The European indexes traded mixed after inflation rose more than estimated in March to 2.7%. Greece is likely to announce new austerity measures. Nestle first quarter sales declined 9% impacted by a stronger domestic currency.[/R]

European markets traded sideways ahead of G-20 finance ministers meeting and a raft of economic data in the euro-zone. Germany revised higher its economic growth, France trimmed economic outlook and Italy’s trade deficit expanded.

U.S. indexes fell on global economic concerns and Asian markets dropped after China reported GDP expanded at 9.7% rate in the first quarter, while the sequential growth was at 2.1%. The consumer price index rose 5.1% in March.

In Paris CAC-40 Index declined 17.38 or 0.44% to 3,953.01 and in Frankfurt DAX index edged higher 17.05 or 0.24% to 7,163.61. For the week, CAC-40 declined 2.6% and DAX 30 edged 0.6% lower.

Greece is likely to announce new austerity measures and privatization plans today in an attempt to meet its deficit-reduction goals.

Rating agency Moody''s lowered its rating on Ireland debt by two notches to Baa3, the lowest investment grade. The agency cited weakening fiscal situation amid subdued economic activity for as reasons for the downgrade.

Annual inflation in the euro area accelerated to 2.7% in March from 2.4% in February. Monthly inflation was 1.4% in March and compared to a year ago annual inflation was 3.1%.

First estimate of the Euro zone trade deficit in February with rest of the world was €1.5 billion compared to a deficit of €1.4 billion a year ago month. First estimate for the wider EU27 trade deficit in January was €9.6 billion.

The leaders of Britain, France and the United States said the NATO coalition will continue its military aggression in Libya until Gaddafi leaves power. U.S. President Barack Obama said that leaving Gaddafi in power would be an ""unconscionable betrayal"" of the Libyan people.

Gainers & Losers

Bauer AG gained 0.15% to €36.20 after the international provider of services, machinery and ancillary products reported fiscal year 2010 net profit fell 5.2% to 39.8 million euros or 2.04 euros per share compared to $42 million euros or 2.28 euros per share last year.

Carrefour SA fell 1.77% to €30.49 after the French retail giant reported sales grew 3.9% to €24.7 billion from €23.8 billion reported last year, on strong growth in Brazil and China.

The retailer also said it struck a deal to sell a 49% stake in BSF Holding to Itau Unibanco for €315 million or $456 million.

Galapagos NV plunged 22.38% to €9.47 after the Belgian biotechnology firm said it will discontinue a mid-stage clinical trial for GLPG0259 in rheumatoid arthritis, citing ""limited efficacy potential"" of the compound.

Nestle Ltd. climbed 1.31% to Sfr53.95 after the Swiss confectioner reported first quarter total group sales declined 9.3% to Sfr20.26 billion compared to Sfr22.34 billion in the comparable period last year impacted by a stronger domestic currency.

Norsk Hydro ASA gained 0.58% to NOK 46.75 after the supplier of casthouse products reported pro forma net income attributable to Hydro shareholders was NOK 779 million or NOK 0.38 per share for the first quarter of 2010. Pro forma revenues for the first quarter of 2010 were NOK 20.79 billion.

Siemens AG advanced 1.32% to €94.43 after the engineering firm may receive orders worth €5 billion from rail operator Deutsche Bahn AG, dpa-afx reported.

Syngenta AG rose 2.21% to Sfr309.30 after the Swedish agribusiness company reported first quarter sales rose 14% to $4.02 billion from last year''s $3.53 billion, boosted by strong growth in crop protection and seeds sales in all regions.