European Markets Higher on GDP Data; Vivendi, Vallourec, UniCredit Up

Arjun Dave
13 May, 2011
New York City

European markets traded higher after the euro-zone economy expanded in the first quarter. Germany led the region with an expansion of 1.5% and France grew at 1%. Italy and Portugal reported weaker than expected growth. Thyssen Krupp, Vallurec and EADS gained after earnings releases.

[R]5:00 PM Frankfurt – European markets traded higher after the euro-zone economy expanded in the first quarter. Germany led the region with an expansion of 1.5% and France grew at 1%. Italy and Portugal reported weaker than expected growth. Thyssen Krupp, Vallurec and EADS gained after earnings releases.[/R]

European markets edged higher after euro-zone gross domestic product increased in the quarter to March. Germany and France economic expansion led the region with peripheral nations still struggling.

The latest economic data showed Germany expanded at 1.5% in the latest quarter from the fourth quarter and rose 4.9% a year ago. France expanded at 1% in the quarter from the fourth quarter.

Portugal and Italy reported weaker than expected economic expansion and Spain expanded but domestic consumption was lower than expected.

Preliminary estimate, first quarter gross domestic product rose 0.8% in the euro-area and in wider zone of 27 nations compared to previous quarter.

Seasonally adjusted GDP rose 2.5% from a year ago quarter in the euro-area and in the EU27.

The DAX 30 index decreased 39.67 or 0.5% to 7,404.27 and CAC 40 index declined 0.2% or 7.9 to 4,015.32.

The euro flirted in a narrow range to close at $1.4241 and oil and gold edged a fractionally higher.

Separately, The European Commission also forecasted that Greece will miss its debt targets unless it carries out more cost cutting or carries out additional restructuring.

Stock Movers

Aurubis AG gained 5% to 43 euros after the copper smelter said first half profit increased 44% from a year ago.

EADS added 5% to 22.91 euros after operating earnings increased to 230 million from 150 million a year ago. The defense contractor and Airbus plane maker said 2011 sales are expected to be ahead of previous estimate.

The company also said that earnings before interest and taxes and special charges will match 2010 earnings of 1.3 billion euros.

Telefonica declined more than 1.4% after it reported lower than expected earnings.

Thyssen Krupp gained 2.5% to 33.55 euros after it reported better than expected earnings.

The Germany based engineering company reported first-half sales rose 21% to €23.6 billion. Second quarter sales grew 21% from the prior year to €12.3 billion. Earnings per share increased to €0.89 compared to €0.80 in the prior year.

UniCredit increased 2% to 1.65 euros after the Italy based bank reported first quarter profit increased 56% to 810 million euros compared to 520 million euros a year ago. The bank also increased the loan loss reserve account by a smaller amount.

Vallourec SA increased 5% to 88.55 euros after the maker of steel pipes and tubes in France for oil and gas industry said first quarter net increased 35%.

Vivendi SA increased 2.5% to 19.54 euros after the company reported adjusted earnings of 950 million euros from 736 million euros a year ago.