European Indexes Mixed; Hochtief Net Plunges 74%, Carlsberg Net Falls 22%

Arthi Gupta
17 Aug, 2011
New York City

European indexes traded sideways after a disappointing meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel. SNB intensified measures against rising Swiss franc. Hochtief net plunged 74% impacted by issues at its Australian subsidiary Leighton.

[R]1:15 PM Frankfurt – European indexes traded sideways after a disappointing meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel. SNB intensified measures against rising Swiss franc. Hochtief net plunged 74% impacted by issues at its Australian subsidiary Leighton.[/R]

French President Nicolas Sarkozy and German Chancellor Angela Merkel’s meeting yesterday in Paris to discuss the region’s debt crisis did nothing to lift market sentiment.

Both the leaders called for economic co-ordination and urged all member nations to adopt balanced budget rules. However, they rejected the issuance of euro bonds as a solution to the ongoing debt crisis.

The leaders also felt there was no need of expanding the euro-zone rescue fund at this juncture from its present €440 billion but considered proposals for a new financial-transaction tax.

Greece reached an agreement with Finland on collateral for securing Finland''s share in Greece’s bailout, reports said citing a statement by the Finnish Finance Ministry.

Finland’s Finance Minister Jutta Urpilainen said at a press conference on Tuesday that Greece would invest a particular amount of money with the Finnish state.

The Swiss National Bank said that it would expand the supply of liquidity to the Swiss franc money market as part of its measures against the ''massively overvalued'' Swiss franc.

The central bank raised the banks'' sight deposit level to Sfr200 billion from Sfr120 billion along with the continuance of repurchase of outstanding SNB bills and employ foreign exchange swaps.

The SNB hinted that further measures to curb the strength of the franc would be taken, if warranted.

Separately, the Swiss government plans measures worth about Sfr1.3 billion to assist the exports and tourism sectors, the Swiss newspaper TagesAnzeiger reported.

In Paris CAC-40 Index gained 17.84 to 0.56% to 3,248.74 and in Frankfurt DAX Index edged lower 17.98 or 0.30% to 5,975.31.

Euro-zone annual inflation slowed to 2.5% in July, as estimated initially, from 2.7% in June, according to data released by Eurostat today. But it continues to stay above the 2% ceiling.

Lafarge Divests Asian Gypsum Business

Lafarge S.A. agreed with Boral Ltd. to sell them its stake in their common Asian Gypsum joint-venture Lafarge Boral Gypsum Asia for €429 million.

LBGA is a 50/50 joint-venture formed in 2000 between Lafarge and Boral.

Gainers & Losers

A.P. Moeller-Maersk A/S gained 1.96% to DKK 35,380.00 after the independent oil and gas explorer said first-half revenue grew 9% to $29.9 billion from $27.4 billion in the prior-year period, primarily due to higher oil prices and container volumes. Profit for the period rose 8% to $2.7 billion, from $2.5 billion last year.

Carlsberg A/S plunged 17.92% to DKK 370.00 after the Danish brewer said its second quarter net revenues increased 4% to DKK 18.74 billion from DKK 17.97 billion last year. Profit in the quarter declined 22% to DKK 2.06 billion or 13.4 kroner per share from DKK 2.63 billion or 17.1 kroner per share in the same quarter last year.

Hochtief AG rose 1.61% to €50.04 after the German builder reported second quarter sales grew 7.5% to €5.46 billion from €5.08 billion last year. Consolidated net profit plunged 74% to €13.84 million or 0.19 euros per share compared to €54.05 million or 0.81 euros per share last year.

Swiss Life Holdings AG surged 3.31% to Sfr102.90 after the life insurance company said first-half profit from operations increased 9% to Sfr452 million from Sfr415 million in the first-half of 2010. Net earned premiums for the period increased 2.1% to Sfr7.61 billion from Sfr7.45 billion in the preceding year.

Telekom Austria AG fell 0.81% to €7.38 after the Austrian telecom group said second quarter revenues decreased 5.1% to €1.11 billion from €1.17 billion in the prior year. Net income in the quarter plunged 71% to €20 million or 0.05 euros per share compared to €68.7 million or 0.16 euros per share last year.