Germany Raises

Arthi Gupta
07 Mar, 2012
New York City

European indexes edged higher after Germany sold

[R]1:30 PM Frankfurt – European indexes edged higher after Germany sold €3.312 billion of 5-year debt at lower borrowing costs. Investors are jittery ahead of the Greek debt swap deadline tomorrow. Adidas quarterly profits soared.[/R]

European indexes rebounded ahead of the Greek debt swap deadline tomorrow. Private investors in Greece will have to decide by tomorrow whether to take a 53.5% haircut of their existing Greek holdings in exchange for new bonds that pay lower interest rate.

At least 40% of private holders of Greek debt have agreed to the swap but uncertainty reigns if hedge funds will participate in the swap or challenge the offer in courts that may drag for more than a decade.

In Paris trading, the CAC-40 Index climbed 26.39 or 0.8% to 3,388.95 and in Frankfurt the DAX Index edged higher 20.43 or 0.3% to 6,653.52.

The yield on Italy’s 10-year note was 5.11% and on the similar Spanish bonds was 5.19%.

Germany Debt Auction

Germany sold €3.312 billion of 5-year Federal Notes at lower borrowing costs, the Bundesbank said.

The yield on the 0.75 percent February 2017 notes dropped to 0.79% from 0.91% in the previous sale on February 8. The bid-to-cover ratio was unchanged at 1.8.

German Orders Drop

German industrial orders declined 2.7% in January from a month ago, following a 1.6% rise in December, the Federal Ministry of Economy and Technology said today.

Gainers & Losers

adidas AG fell 1.7% to €56.77 after the sports apparel manufacturer said fourth quarter group revenues increased 11% to €3.26 billion from €2.93 billion in the year-ago quarter. Net income in the quarter surged 157% to €18 million or 9 cents per share compared to net income of €7 million or 3 cents per share last year.

For fiscal year 2011, group revenues grew 11% to €13.34 billion in 2011 from €11.99 billion in 2010. Net income for the year increased 18% to €671 million in 2011 from €567 million in 2010.

Air France-KLM climbed 1.6% to €4.18 after the French-Dutch airline reported a 6.2% rise in passenger traffic for February.

Axel Springer AG dropped 1.4% to €35.50 after the print and digital media company stated fiscal year 2011 total revenues increased 10.1% to €3.18 billion from €2.89 billion the previous year.

EBITDA for the year adjusted for non-recurring effects and effects of purchase price allocations rose 16.2% to €593.4 million from €510.6 million last year.

Homag Group AG slumped 4% to €9.37 after the manufacturer of plant and machinery reported preliminary 2011 sales revenue rose 11% to €798.7 million from €717.7 million the prior year. Net loss after non-controlling interests were €4.7 million compared to a profit of €6.7 million last year.

Klöckner & Co SE rose 1.9% to €10.60 after the metal handler reported full-year 2011 sales climbed 36.5% to €7.1 billion from the previous year. Net income for the period slumped 88% to €10 million from €80 million a year ago. Basic earnings per share fell to 14 cents compared with €1.17 a year earlier.