European Indexes Fall; Infineon Net Soars, Hannover Re Net Plunges

Arthi Gupta
03 May, 2011
New York City

European indexes declined as automakers led the decline. Euro area producer price inflation accelerated for the fifth straight month in March. Infineon raised its sales growth outlook for fiscal 2011. Metro net loss narrowed.

[R]1:30 PM Frankfurt – European indexes declined as automakers led the decline. Euro area producer price inflation accelerated for the fifth straight month in March. Infineon raised its sales growth outlook for fiscal 2011. Metro net loss narrowed.[/R]

Global indexes traded lower tracking lower commodities.

Euro area producer price inflation accelerated for the fifth straight month in March according to the data from Eurostat today.

The total industry producer prices on the domestic market excluding construction rose 6.7% annually in March faster than February''s 6.6% increase. On a monthly basis, producer prices increased 0.7% in March, following a 0.8% rise in February.

The Swedish central bank highlighted risk of accelerating inflation at its April 19 rate setting meeting and raised rate 25 basis points to 1.75%.

The current high consumer price inflation does not make a more significant impact on various agents'' long-term inflation expectations and on wage formation, according to minutes of the Riksbank''s April monetary policy meeting released today.

In Paris CAC-40 Index declined 32.28 or 0.79% to 4,076.49 and in Frankfurt DAX index edged lower 69.01 or 0.92% to 7,458.63.

Nasdaq and ICE Plans Exchange Offer

Nasdaq OMX Group, Inc. and Intercontinental Exchange, Inc. said on Monday that their boards have approved the commencement of an exchange offer to acquire all of the outstanding shares of NYSE Euronext. The cash and stock transaction is valued at approximately $11 billion.

The Nasdaq and ICE''s combined hostile takeover seeks to scuttle the mid-February deal between NYSE Euronext and Germany''s Deutsche Boerse AG.

Saab Inks Agreement with Hawtai Motor

Saab Automobile AB announced that the company and Spyker Cars N.V., Saab''s parent company, signed an agreement with Hawtai Motor Group Co. Ltd. This deal conditionally secures medium term funding and includes financing in the form of subscription agreements in the amount of €150 million as well as a strategic alliance for China including joint ventures on manufacturing, technology and distribution.

Gainers & Losers

France Telecom SA fell 0.38% to €15.80 after the telecommunication operator reported first quarter consolidated revenues rose 2.5% to €11.23 billion from €10.96 billion a year ago, driven by strong mobile growth mainly in emerging markets, despite heavy competition in France.

Hannover Rückversicherung AG slumped 3.04% to €39.81 after the German reinsurer reported first quarter total revenues rose 12.5% to €2.89 billion from €2.57 billion generated in the previous year. Net income in the quarter plunged 65% to €52.3 million or 0.43 euros per share from €151 million or 1.25 euros per share in the year earlier quarter, impacted by a major loss due to severe natural disasters in Japan, Australia and New Zealand.

Infineon Technologies AG gained 1.98% to €7.89 after the German semiconductor company reported second quarter revenues grew 27% to €994 million from last year''s €781 million. Net income in the quarter surged 624% to €572 million or 0.50 euros per share from €79 million or 0.07 euros per share in the previous year.

Metro AG plunged 3.19% to €47.87 after the department stores operator said first quarter revenue was nearly flat with last year at €15.52 billion. Loss in the quarter narrowed 81.3% to €3 million or 0.01 euros per share from last year''s €16 million or 0.05 euros per share.

Qsc AG plummeted 4.30% to €2.42 after the German broadband network operator entered into a purchase agreement to buy about 59% of the 4 million total shares issued by Informationssysteme AG at a price of €14.35 per share.

Swiss Life Holdings AG fell 4.57% to Sfr150.50 after the Swiss life insurance provider said first quarter premium income dropped 10% in local currency to Sfr6.814 billion, as higher results in Switzerland was more than offset by a poor performance in France and Germany.