Euro Area Construction Output Rebounds, Spanish Yields Rise

Arthi Gupta
21 May, 2012
New York City

The European indexes gained after G8 leaders reiterated their support for Greece. Euro area construction output rebounded in March and home prices in the UK rose in April. Ryanair slumped 4% on weak fiscal year outlook. Kabel Deutschland agreed to buyTele Columbus for

[R]1:00 PM Frankfurt – The European indexes gained after G8 leaders reiterated their support for Greece. Euro area construction output rebounded in March and home prices in the UK rose in April. Ryanair slumped 4% on weak fiscal year outlook. Kabel Deutschland agreed to buyTele Columbus for €603 million.[/R]

The European indexes climbed slightly after G8 leaders reaffirmed their support for Greece and urged the nation to stay in the euro zone.

At the weekend meeting of leaders in Maryland urged to Greece stay in the currency union and said the nation must respect its financial commitment to lenders.

German Finance Minister Wolfgang Schaeuble will meet with his French counterpart Pierre Moscovici in Berlin later today.

In Paris trading, the CAC-40 Index gained 16.24 or 0.5% to 3,024.24 and in Frankfurt the DAX Index edged higher 45.19 or 0.7% to 6,316.80.

The yield on Spain’s benchmark 10-year bonds grew three basis points to 6.30%, and the yields on the 10-year Italian bonds were at 5.82%.

Euro Area Output Rebounds

Euro-zone construction output soared 12.4% from a month ago in March compared to the 10.4% slump in February, the latest data from Eurostat showed today.

Annually, construction output decreased 3.8% in March.

In the wider EU27 nations region, output rose 11.8% from a month ago but fell 3.9% annually in March.

French Leading Indicator Climbs

A leading indicator of French economic activity climbed in March.

The Conference Board said that the leading economic index rose 0.4% on a monthly basis in March, following a revised 0.6% increase in February.

UK Home Prices Rise

The average asking price for a home in the United Kingdom rose 2% from a year ago in May, following the 3.4% increase in April property Rightmove said today. The average asking price of property was £243,759.

On a monthly basis, home prices were flat in May following the 2.9% surge in April.

Separately, UK gross mortgage lending declined 19% in April from a month ago to £10.2 billion, the Council of Mortgage Lenders said.

Kabel Deutschland Acquires Tele Columbus

Kabel Deutschland Holding AG, the German cable network operator agreed to acquire Tele Columbus GmbH, the cable provider in Germany for €603 million plus accrued interest.

The company noted that the deal will strengthen the existing broadband infrastructure competition in Germany.

Tele Columbus provides basic cable services to approximately 1.7 million customers in 2.1 million homes connected.

Gainers & Losers

GSW Immobilien AG rose 1.4% to €26.04 after the German real-estate company reported first quarter consolidated net income plunged 74% to €8.7 million from €33.2 million in the previous year.

HSBC Holdings Plc gained 0.3% to 511 pence after the Asia focused bank completed the sale of its 195 retail branches, primarily in the state of New York, to First Niagara Bank, N.A. for around $0.9 billion.

Man Group Plc soared 6.7% to 80.35 pence after the British alternative investment management business agreed to acquire the entire issued share capital of FRM Holdings Ltd., a global hedge fund research and investment specialist.

Rolls-Royce Holdings Plc fell 1.2% to 804.50 pence after the power systems company won $136 million contract to supply industrial trents to UAE-based Dolphin Energy Limited.

Ryanair Holdings plc slumped 4.2% to €3.85 after the Irish low-cost airline said full-year 2012 revenues grew 19% to €4.33 billion from €3.63 billion a year ago. Profit for the year soared 25% to €503 million compared to €401 million last year.

WPP Plc edged higher 1.6% to 779 pence after the advertising agency company''s wholly-owned operating company; Ogilvy & Mather reached an agreement to acquire a stake in Today Advertising, an advertising agency in Myanmar.