Vodafone and Taylor Wimpey Lift Dividend, European Indexes Close Mixed

Lucy Stoeva
17 May, 2016
New York City

European stock markets erased early gains. U.K. homebuilder Taylor Wimpey surged 4.7% on better than expected dividend payout policy. Vodafone rose 1.5%, after the telecom operator said its European business grew for the first time in six years and increased its dividend payout.

[R]4:00 PM Frankfurt, Germany – European stock markets erased early gains. U.K. homebuilder Taylor Wimpey surged 4.7% on better than expected dividend payout policy. Vodafone rose 1.5%, after the telecom operator said its European business grew for the first time in six years and increased its dividend payout.[/R]

European stock markets erased early gains and closed mixed on Tuesday, with advances in bank and commodity shares offset by losses in the auto sector.

The dollar fell 0.17% against to euro to €0.88 and fueled growth in energy and commodity shares, since oil and metal prices benefit from a weaker dollar.

Shares of Anglo American soared 3.2%, BHP Billiton added 2.6%, Glencore rose 2.2%, and Antofagasta climbed 2%.

Brent crude oil futures advanced 0.86% to $49.39 per barrel, while WTI crude oil futures gained 1.15% to $48.27.

Among energy stocks, Tullow Oil edged up 1.1%, Lundin Petroleum rose 0.7%, and Royal Dutch Shell climbed 0.4%.

In Greece, Alpha Bank surged 5.50% and Eurobank Ergasias jumped 2.9% on media reports that the International Monetary Fund wants the euro zone to relieve Greece from paying interest or principal on its bailout loans until 2040.

In the U.K., homebuilder Taylor Wimpey gained 4.7% on better than expected dividend payout policy due to strong housing market.

Vodafone was also among the gainers, up 1.5%, after the world''s second-largest mobile phone operator said its European business grew for the first time in six years and increased dividend payout.

On the downside, Fiat Chrysler tumbled 6.7% on negative analyst expectations about its future growth. The news had a negative effect on the entire sector, with Volkswagen down 2.7% and BMW losing 3%.

In London, the FTSE 100 index edged up 16.37, or 0.27%, to 6,167.77, while in Frankfurt, the DAX index erased 62.71, or 0.63%, to 9,890.19.

In Paris, the CAC 40 index dropped 14.71, or 0.34%, to 4,297.57.

The Athens Composite Index gained 1% to 936.64.

Taylor Wimpey Plc advanced 4.7% to 193.6 pence after the home builder increased its dividend payments due to strength of the UK property market.

The company will pay special dividend of £300 million in July 2017 and will increase its ordinary dividend. It promised investors a total of £1.3 billion in dividend payouts over the next three years.

According to Taylor Wimpey, the UK new-build housing market remains very positive, with high consumer demand and confidence.

Vodafone Plc jumped 1.5% to 227 pence after the world''s second-largest mobile phone operator said its European business grew for the first time in six years and increased its dividend payout by 2%.

Total sales increased 2.3% to £40.97 billion for the full financial year, while earnings rose 2.7% to £11.6 billion.

Growth was strongest in emerging markets, up 7% from the previous year, and in the data segment revenues soared 71% over the previous year.

Investments in new infrastructure led to a surge of 31% in total debt to £29.2 billion.