European Markets Halt 7-Day Decline, Opera Software Soars 33%

Lucy Stoeva
10 Feb, 2016
New York City

European markets halted 7-day losing streak after investors returned for bargain hunting. Deutsche Bank rebounded on unconfirmed reports that the largest German bank may buy back bonds. Opera Software surged 33.5% after receiving an offer for $1.23 billion from China.

[R]4:00 PM Frankfurt, Germany – European markets halted 7-day losing streak after investors returned for bargain hunting. Deutsche Bank rebounded on unconfirmed reports that the largest German bank may buy back bonds. Opera Software surged 33.5% after receiving an offer for $1.23 billion from China.[/R]

Financial markets turned around after seven-day losing streak amid stronger corporate earnings and a search for bargains.

Investors shrugged off the latest economic data, which shows that major European economies are shrinking, and preferred to focus on bargain hunting and positive earnings news.

In France, industrial production fell 1.6% in December from the previous month, according to statistical agency Insee.

In the U.K. industrial production declined 1.1% in December from the previous month, the Office for National Statistics said.

Banks were among the best performing stocks after the heavy losses in previous sessions.

Shares of Deutsche Bank rebounded 11.7% on unconfirmed reports that the bank is considering an extensive bond buyback program.

The recovery of Deutsche Bank from multi-year lows provided investors with more confidence about the banking sector.

UniCredit soared 11.5% and Commerzbank gained 7.9%.

In London, FTSE 100 index rose 60.01, or 1.07%, to 5,692.20 and in Frankfurt, the DAX index surged 200.98 or 2.41%, to 9,080.38.

In Paris, the CAC 40 index added 96.36, or 2.41%, to 4,093.90.

Akzo Nobel N.V inched down 1.4% to €52.65 after the paints and specialty chemicals company warned of a difficult year ahead, despite reporting 29% growth in EBITDA.

The Dutch company said market conditions remain difficult in Brazil, China and Russia, while it doesn’t expects a significant improvement in Europe.

Net profit rose to €203 million in the latest quarter from €7 million a year earlier.

EBITDA increased to €426 million from €330 million a year earlier.

The company declared a full-year dividend of €1.55 a share, up from €1.45 in 2014.

A.P. Moeller-Maersk AS slumped 2.8% to 7,745 Danish kroner after the shipping and oil group swung to a loss in the fourth quarter of 2015.

The company booked impairments of $2.6 billion on its oil assets.

For 2016, Maersk expects financial results to deteriorate because of a further decline in freight rates and the demand for transport and the low oil prices.

Carlsberg A/S jumped 4% to 569.5 Danish kroner after the fourth-largest brewer in the world estimated organic sales growth in 2016.

Net profit in the fourth quarter fell to 78 million Danish kroner from 168 million kroner in the same period a year ago due to impairment and restructuring charges.

Sales in the fourth quarter rose to 14.66 billion Danish kroner from 14.33 billion a year ago, helped by growth on Asian markets.

The board proposed a dividend of 9 Danish kroner per shares, flat from the previous year.

Heineken NV lost 1.8% to €73.81 despite raising its dividend and reporting and a rise in sales and profit.

The Dutch brewer reported revenues of €20.5 billion for 2015, compared with €19.3 billion in 2014.

Net profit increased to €1.9 billion in 2015 from €1.5 billion a year earlier.

Heineken increased full-year dividend to €1.30 a share from €1.10 a year earlier.

Heineken estimated revenue and earnings to increase in 2016.

Hikma Pharmaceuticals Plc shed 0.5% to 1,985 pence after the company lowered offer price for Roxane Laboratories Inc. and Boehringer Ingelheim Roxane Inc. on weaker earnings in 2015.

Opera Software ASA, surged 33.5% to 65.10 Norwegian kroner after the mobile software company received a cash offer from a group of Chinese companies.

The offer values Opera at 10.5 billion Norwegian kroner, or $1.23 billion.

Smurfit Kappa Group Plc surged 12.5% to 20.57 after the Irish packaging company reported pre-tax profit growth of 58% to €599 million in 2015 and a marginal improvement of revenues to €8.11 billion.

Smurfit Kappa expects further earnings growth in 2016 after spending €380 million on acquisitions last year and €450 million on improvements.

Telenor ASA tumbled 6% to 123.6 Norwegian kroner after the telecom operator reported a net loss for the fourth-quarter due to an impairment in Denmark and competition in Asian markets.

Net loss amounted to 2.13 billion Norwegian kroner, compared with a net profit of 1.77 billion kroner a year earlier.

Revenue increased to 33.49 billion Norwegian kroner, up from 29.1 billion a year earlier.

Telenor proposed a full-year dividend of 7.50 Norwegian kroner a share, up from 7.30 in 2014.

Telenor expects 2% to 4% organic revenue growth and EBITDA margin of 33% to 34% in 2016.