European Markets Ahead of Fed Decision, Tullow Discovers Oil in Kenya

Lucy Stoeva
16 Mar, 2016
New York City

European markets were little changed as investors remained cautious ahead of the U.S. Fed decision on interest rates. Tullow Oil discovered oil in Kenya

[R]4:00 PM Frankfurt, Germany – European markets were little changed as investors remained cautious ahead of the U.S. Fed decision on interest rates. Tullow Oil discovered oil in Kenya’s northern Kerio Valley. German engineering company Bilfinger canceled its dividend due to widening losses.[/R]

European markets oscillated little changed, as investors remained cautious ahead of the announcement of the Federal Reserve’s decision on interest rates.

The latest U.S. data showed that inflation increased more than expected in February.

The core Consumer Price Index, which excludes volatile food and energy, rose 0.3% in February at a pace similar to that in January, the Labor Department said.

The core CPI, however, rose 2.3% for the year ended in February after an advance of 2.2% in January on an annual basis.

The report fueled investors’ expectations for a Federal Reserve rate hike hours before the U.S. central bank announces its decision.

The Fed''s announcement on its latest policy is expected at 6 p.m. GMT.

Energy stocks charged higher after oil prices recovered from Tuesday losses. Brent crude oil futures gained 3.48% to $40.09, while WTI crude oil soared 4.1% to $37.81.

Norwegian drilling company Seadrill surged 8%, Portuguese producer Galp jumped 4.3%, and Royal Dutch Shell climbed 3%.

In London, FTSE 100 index was up 36.14, or 0.59%, to 6,176.11, while in Frankfurt, the DAX index gained 50.12, or 0.50%, 9,983.97.

In Paris, the CAC 40 index dropped 7.10, or 0.16%, to 4,465.53.

Bilfinger AG plummeted 9.2% to €39.58 after the engineering services group canceled its dividend due to widening net losses.

Pet Utnegaard, CEO, said shareholder payouts will resume only when Bilfinger achieves its goals, but didn’t specify a timeframe.

Brenntag AG surged 7.5% to €48.07 after the chemicals distributor posted an upbeat forecast for 2016.

The German company reported net profit of €365 million for 2015, compared with €339.3 million a year earlier.

Operating EBITDA grew 11.1% to €807.4 million, while sales jumped 3.3% to €10.35 billion on a current currency basis.

Excluding the effects of currency, EBITDA increased 0.7% and sales were down 4.6%.

For 2016, Brenntag projected improvement in all relevant earning parameters.

Tullow Oil Plc jumped 7.5% to 206.50 pence after the British energy group discovered oil in Kenya’s northern Kerio Valley.

The finding could result in the second oil basin in Kenya and may help company to become an oil exporter.

The discovery represents “an active petroleum system with significant oil generation,” according to the company announcement.