Europe Gains on Steel

Ivaylo
11 Dec, 2006
New York City

European stocks were higher on Monday as gains, powered by takeover speculation, countered dropping oil producers as crude prices sank. On Monday, Continental was among the top advancers after General Capital Group, which tried to buy the German tyremaker earlier in the year, announced it would not rule out another takeover attempt. By mid morning, London FTSE 100 climbed 0.4%, Frankfurt Xetra Dax gained 0.5%, and the CAC 40 was 0.7% higher.

[R]6:30AM European markets gained in early trading Monday on strong steel shares.[/R]
European markets were higher on Monday. By mid morning, London FTSE 100 rose 0.4%, Frankfurt Xetra Dax gained 0.5% to 6,462.11, and the CAC 40 was 0.7 % higher at 5,422.5.

Advancers

Continental shares gained 2.3%. Corus, the Anglo-Dutch group, was 4.6% higher on the prospect of a bidding war as Tata Steel of India said it was reconsidering its position after CSN, the Brazilian steel company agreed to buy Corus for 4.9 billion pounds. Mittal Steel, gained 2.3% and ThyssenKrupp gained 0.6%.

Deutsche Börse advanced 2.9% as weak hopes surfaced that Euronext proposed merger with NYSE Group might not yet be a cut deal, leaving the German exchange operator with a chance of an alternative offer.

Decliners

Autostrade, the Italian road builder and operator, declined 3.4% as hopes of a takeover by Spanish peer Abertis evaporated. Shares in Abertis were 2% higher. Oil groups were lower as crude prices declined. Royal Dutch Shell was off 0.5% as it entered talks with Russian Gazprom over control of the Sakhalin-2 liquefied natural gas project off the Russian far-east coast.

Oil and gold

Crude oil was little changed due to speculation that global stockpiles will limit the effect if OPEC cuts production later this week. Crude oil for January delivery was trading for $61.87 a barrel, down 16 cents, in electronic trading on the NYME in early trading in London. The Brent contract for January settlement on the London-based ICE Futures Exchange gained 37 cents to $62.57.

Gold traded in London at $625.50 per troy ounce, down from $636.00 late Friday.

Currencies

The U.S. dollar was mostly up against other major currencies in European trading Monday morning. The euro traded at $1.3193, down from $1.3200 late Friday.The dollar bought 116.89 Japanese yen, up from 116.47. The British pound traded at $1.9503, down from $1.9525.

[R]5:00AM Gold and silver stocks dropped on Friday on stronger dollar.[/R]
February gold lost $6 a troy ounce to end at $631 on the New York Mercantile Exchange. March silver dropped 14 cents to finish at $13.895 and January platinum dipped $17.10 to $1,107.80 an ounce. March palladium advanced $2.95 to $333.95 an ounce. The top-traded March copper contract advanced 1-cent to end at $3.1120 per pound.

The January crude oil declined 46 cents to $62.03 a barrel after reaching $63.65 but failing to rise above $64. January heating oil lost 2.15 cents to end at $1.7573 a gallon after advancing to $1.8190 a gallon. January unleaded gasoline slipped 0.62 cent to $1.6213 a gallon while January natural gas moved 11.0 cents lower to finish at $7.561 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures closed 0.05 cent down at $1.2185 a pound. March futures of raw sugar in foreign ports gained 0.15 cent to close at 11.37 cents a pound.