European Markets Gain Slightly

Ivaylo
03 Jan, 2007
New York City

European stock markets rebounded from early weakness on Wednesday, although the advance was marginal as profits were taken following the strong rally of the previous session. Xetra Dax index in Frankfurt bounced back from early losses to edge higher after German unemployment rate reached its biggest decline since reunification. By mid morning, FTSE 100 in London edged 0.1% lower, Frankfurt Xetra Dax advanced 0.1% higher, while the CAC 40 in Paris moved fractionally higher.

[R]7:00 AM European markets gain slightly Wednesday on profit-taking.[/R]
European markets were higher on Wednesday. By mid morning, FTSE 100 in London edged 0.1% lower to 6,306.8, Frankfurt Xetra Dax advanced 0.1% higher at 6,685.56, while the CAC 40 in Paris moved fractionally higher to 5,619.35.

Advancers

In Switzerland ABB, an engineering company, added 2.3%, while logistics firm Kuehne & Nagel added 2.7 %, and private bank Julius Baer gained 1.9%.

Another Swiss company, Richemont, luxury goods retailer and watchmaker, and rival Swatch, both gained. Data published shortly before Christmas showed Swiss watch exports had increased by 13% in November, while growth over the 12 months to the end of November was 12.7%. Shares in Richemont, owner of the Cartier brand, advanced 2%, while Swatch, the biggest watchmaker in the world, gained 1.2%.

The financials were buoyed by recent market performances and helped boost many European bourses from early losses. UBS, the Swiss investment bank, gained 2.3%, Alpha Bank in Greece rose 1.6% and Intesa Sanpaolo, the newly-merged Italian bank, rose 1.4%.

Peugeot gained 1.7% after Exane BNP Paribas lifted its price target on the the French carmaker.

Decliners

Miners were among the worst hit by profit taking, while industrial metals groups were also lower. Arcelor Mittal was down 1.1%, while ThyssenKrupp declined 1.8%.

Gold and oil

Crude oil declined below $61 a barrel in New York as mild weather in the U.S. limited heating demand and traders speculated that fuel inventories rose last week. Crude oil for February delivery fell 84 cents, or 1.4%, to $60.21 a barrel on the New York Mercantile Exchange and traded at $60.30 a barrel at 11:46 in early trade in London. Brent crude traded at $60.06 on the London-based ICE Futures exchange.

Gold for February delivery advanced $5.20, or 0.8%, to $643.20 an ounce on the New York Mercantile Exchange.

Currencies

The dollar on Wednesday advanced slightly against the euro, which had started 2007 up against the U.S. currency in thin trading. The 13-nation European currency purchased $1.3274, a slight slip from $1.3276 in late trading in New York on Tuesday. The British pound also shed a little to the dollar, trading at $1.9637, down from $1.9729. The dollar gained on the Japanese yen to 119.24 yen from 118.85 yen late Tuesday.

[R]5:00 AM Gold advanced Tuesday on CME Globex, Nymex closed.[/R]
Gold for February delivery advanced $4.30, or 0.7%, to end at $642.30 an ounce in electronic trading on CME Globex. Other metals markets were mixed in electronic trading, with March silver gaining 33 cents to finish at $13.265 an ounce and March palladium $1 higher to close at $339.50 an ounce, but January platinum slipped 30 cents to end at $1,139 an ounce while March copper lost 8.3 cents to $2.788 a pound.


Crude-oil futures started the New Year on slightly lower ground Tuesday, while natural-gas prices dropped 3%. Crude oil for February delivery declined 23 cents to close at $60.85 a barrel in trading on the CME Globex electronic platform, after hitting a high of $61.55. The February contract in natural-gas futures shed 4 cents, or 0.6%, to stand at $6.259 per million British thermal units following a low of $6.10. Natural-gas futures prices plunged 44% in 2006.