Higher Start for Europe

Ivaylo
18 Oct, 2006
New York City

European stocks advanced in early trading on Wednesday, with the technology sector supported by well-received overnight earnings from U.S. giants Intel and IBM, which, coupled with mining sector gains, helped investors ignore earnings-related news from Akzo Nobel and ASML Holding. The U.K. FTSE 100 index gained 0.6%, Frankfurt Xetra Dax was up 0.5% and CAC 40 in France was up 0.5%.

[R]6:30AM European stocks rise in early trading Wednesday on tech stocks.[/R]
European markets were higher by mid-morning on Wednesday. The U.K. FTSE 100 index gained 0.6% at 6,144.40, Frankfurt Xetra Dax was up 0.5% at 6144.33 and CAC 40 in France was up 0.5% at 5330.73.

Advancers

Leading fine paper manufacturer, M-real rose 13% after the company tabled a cost cutting plan expected to save 100 million euros.

British Energy bounced back after a sharp fall earlier in the week and was up 3.7% as analysts said there was plenty of spare energy capacity for the coming winter despite problems at the company nuclear power stations.

Man Group was higher by 3.4% amid news it plans to demerge its brokerage, Man Financial. In mining stocks, BHP Billiton was up 1.1% and Rio Tinto was up 2.8% as analysts expect upbeat metals prices.

Decliners

Akzo Nobel declined 7% after the Dutch pharmaceutical group announced a delay loomed in launching its anti-schizophrenic drug, asenapine amid missing analysts quarterly earnings expectations. Dutch electronic chip maker, ASML sank 5%, despite reporting a record third quarter profit that exceeded forecasts.

Reuters plunged 1.6% as well after it reported third quarter results sightly better than forecasts. Collins Stewart cut Reuters to a hold from buy after the earnings release.

Oil and gold

Oil prices moved higher on Wednesday ahead of the release of weekly U.S. petroleum supply data expected to show a decline in distillate stocks. Light, sweet crude oil for November delivery rose 23 cents to $59.16 a barrel in on theNYME. December Brent crude oil on London ICE Futures exchange rose 33 cents to $61.27 a barrel.

Gold traded in London at $595.25 a troy ounce, up from $587.20 late Tuesday.

Currencies

The U.S. dollar was mixed against other major currencies in European trading on Wednesday morning. The euro was quoted at $1.2538, down from $1.2546 late Tuesday in New York. The British pound was quoted at $1.8699, down from $1.8704. The dollar bought 118.69 Japanese yen, down from 118.89.

[R]5:00 AM Gold prices fell below $600 an ounce on Tuesday on oil slump.[/R]
The most-active December gold declined $5.00 at $593.50 a troy ounce on the NYME. December silver settled 13 cents lower at $11.78 an ounce. January platinum moved $8.30 lower to settle at $1,083 an ounce and December palladium plunged $4.95 to close at $319.60 an ounce. The most-active December copper contract fell 8.50 cents to settle at $3.4960 per pound.

The November crude oil contract settled down $1.01 at $58.93 a barrel while the November heating oil sank 2.27 cents to finish at $1.7338 a gallon. November gasoline settled down 2.84 cents to $1.4633 a gallon. November natural gas lost 0.2 cent to end at $6.442 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures closed 0.55 cent higher at $1.0245 a pound, with March up 0.50 cent at $1.0640. Futures on raw sugar in foreign ports for March settled 87 points higher at 12.58 cents a pound.