Europe Starts Week Higher

Ivaylo
04 Sep, 2006
Frankfurt

European shares traded higher on Monday, lifted by a higher U.S. close on Friday, as investors observed some mixed corporate news on the U.S. Labor Day holiday. The increase in U.S. jobs suggests that the Fed will find it harder to hike rates, at least in the near term, which boosted the markets. The U.K. FTSE 100 index rose 0.1%, the German DAX Xetra 30 index gained 0.4% and the French CAC-40 advanced 0.2%.

[R]6:30AM European markets started the week higher on U.S. job data.[/R]
European markets were higher on Monday. The U.K. FTSE 100 index rose 0.1% to 5,954, the German DAX Xetra 30 index gained 0.4% to 5,898 and the French CAC-40 advanced 0.2% to 5,195. In corporate news, French satellite operator Eutelsat advanced 1.3% after it reversed to a fiscal 2006 profit of 30.4 million euros from a fiscal 2005 loss of 52.3 million euros, while U.K. satellite company Inmarsat rose 1.1%, having signed a deal to collaborate with ACeS to offer low-cost hand-held and fixed voice services, initially in the Asian market.

The leading sector, though, was forestry and paper, up 2%, with Stora Enso rising 2.2% and UPM-Kymmene 1.7% higher. Deutsche Telekom advanced 0.2% after the telecoms group announced a restructuring of its management responsibilities at the weekend after the German telecoms group had been forced to cut its growth and profit guidance a month ago.

Crude oil dropped close to $68 a barrel, an 11-week low, as the U.S. summer travel season drew to a close and traders speculated a dispute with Iran about nuclear research may be resolved without reducing oil exports. Crude oil for October delivery fell 88 cents to $68.31 a barrel, while Brent crude oil for October settlement fell $1.10 to $68.05 a barrel on the London-based ICE Futures exchange.

Gold opened Monday at a bid price of $626.60 a troy ounce, up from $623.20 late Friday. The euro started the week up against the U.S. dollar Monday, building on gains from the week before. In morning European trading the euro bought $1.2861, up from $1.2836 on Friday in late trading in New York. The dollar slid to purchase 116.49 Japanese yen from 117.06 on Friday, while the British pound rose to $1.9076 from $1.9059 in New York.

[R]5:00AM Silver and copper futures advanced Friday, while gold retreated.[/R]
December gold declined $1.60 to $632.60 a troy ounce on the NYME, up from a low of $628. December silver managed to end up 4 cents to $13.07 after an earlier low of $12.825. October platinum rose $3.60 to $1,254.80 an ounce, while December palladium gained 90 cents to $349.60. December copper gained 0.50 cent to settle at $3.4610 per pound.

Crude oil futures in New York dropped below $70 a barrel Friday after widely watched hurricane forecaster Colorado State University cut its 2006 Atlantic tropical storm season forecast for the second time. The front-month October light, sweet crude contract finished $1.07 lower at $69.19 a barrel. October gasoline closed down 4.87 cents to $1.7344 a gallon, while September natural gas settled down 17.1 cents at $5.877 a million British thermal units.

On the New York Board of Trade, September Arabica coffee closed down 0.60 cent at $1.0340 a pound while December lost 0.40 cent to $1.0760. October futures of raw sugar in foreign ports retreated, breaking Thursday''s low as funds sold in late action and sinking to a new 9-month low of 11.26 cents per pound. October finished 0.41 cent lower at 11.39 cents a pound.