European Indexes Sideways; Jobless Rate at 10.8%

Arthi Gupta
02 Apr, 2012
New York City

The European indexes lost early momentum after unemployment rose in February. Privately held cosmetic maker Coty offered to acquire U.S. based Avon Products for $10 billion. Barry Callebaut first-half net declined.

[R]3:30 PM Frankfurt – The European indexes lost early momentum after unemployment rose in February. Privately held cosmetic maker Coty offered to acquire U.S. based Avon Products for $10 billion. Barry Callebaut first-half net declined.[/R]

Stocks in early morning rose but market indexes faded in the afternoon after unemployment rose in the last month. Market momentum was positive after China reported better than expected manufacturing growing easing fears of abrupt slowdown.

Markets also noted a $10 billion friendly offer for the U.S. based direct cosmetics maker Avon Products, Inc from Coty. Privately held cosmetic maker said it has arranged financing and is prepared to increase its offer if company opens its books and responds to its overtures.

Coty said its several approaches to Avon in the last two months were rebuffed by its long time chief executive Andrea Jung and the company board.

The China Federation of Logistics and Purchasing said that the purchasing managers'' index improved to 53.1 in March from 51 in February, the highest since March last year.

In Paris trading, the CAC-40 Index fell 11.59 or 0.3% to 3,412.05 and in Frankfurt the DAX Index edged higher 0.33 or 0.01% to 6,947.02.

Italian 10-year bond yield fell five basis points to 5.05% and yield on similar Spanish government bonds decreased seven basis points to 5.26%.

Euro-zone Jobless Rate Up

The seasonally adjusted jobless rate in the euro area rose to 10.8% in February from 10.7% in January, data from Eurostat showed today.

The rate was 10% in February 2011.

Compared with January, the number of unemployed increased by 162,000 in the euro area and for the year to the month unemployment rose by 1.476 million.

In the wider area of the EU27 region, the jobless rate was 10.2% in February compared with 10.1% in January.

Gainers & Losers

Abertis Infraestructuras SA rose 0.2% to €12.78 after the Spanish infrastructure operator reached an agreement with Telefonica to purchase 500 mobile telephone towers for an initial amount of €45 million.

Actelion Ltd. dipped 0.2% to Sfr32.95 after the Switzerland-based biopharmaceutical holding company said two recently concluded studies with the first orally-active CRTH2 antagonist, setipiprant, in asthma and seasonal allergic rhinitis did not confirm efficacy findings made in earlier studies.

The company further added that clinical development with this well-tolerated agent in these indications is being discontinued.

Barry Callebaut AG slumped 4.9% to Sfr860 after the Swiss manufacturer of cocoa and chocolate products reported first-half sales revenue increased 3% to Sfr2.48 billion from Sfr2.40 billion last year. Net profit for the period declined 18% to Sfr121.8 million from Sfr148.6 million last year.

Nordex SE climbed 0.4% to €4.55 after the manufacturer and supplier of wind energy systems said first quarter order intake surged 84% to €284 million from €154 million last year. Consolidated sales slid 5.2% to €921 million from €972 million last year.

Q-Cells SE, the German manufacturer of photovoltaic cells plunged 18.4% to €0.17 on reports that the company may file for bankruptcy.

TNT Express N.V. declined 0.1% to €9.25 after the Dutch express delivery company said that pricing pressure and declining international volumes have negatively impacted operating results in Europe & Middle East Africa since the start of 2012.