Industrials and Chemicals Bring Europe down

Ivaylo
26 Jan, 2007
New York City

European shares declined on Friday morning, with chemical and industrial firms leading the decline after U.S.-inspired selling offset gains at cosmetics giant L''Oreal. Industrials such as Siemens and defense company EADS also traded lower. Futures on German 10-year bonds also declined on Friday. The U.K. FTSE 100 index retreated 0.6%, German DAX Xetra 30 index dropped 0.8% and the French CAC-40 index slipped 1%.

[R]6:30AM European stocks fell Friday on weaker chemical and industrial shares.[/R]
European markets were lower Friday. In morning trade, the U.K. FTSE 100 index retreated 0.6% at 6,231.10, German DAX Xetra 30 index dropped 0.8% at 6,667.01 and the French CAC-40 index slipped 1% at 5,554.11.

Decliners

Siemens shares declined 2% despite strong gains made Thursday after earnings while EADS lost 1.6% on reports that the U.K. government could review contracts if the company does not proceed with a planned 100 million pound investment.

Chemical company, Bayer, slipped 1.4%, and another chemical firm, Linde, lost 1.2% while Imperial Chemical Industries declined 1.1%.

Advancers

L''Oreal gained 3.9% in early Paris trading after the cosmetics company late Thursday reported that Q4 comparable sales grew 6.5%. Credit Suisse updated L''Oreal to outperform after the figures.

Carrefour shares added 0.3% after Citigroup upped the French supermarket chain to hold from sell, citing valuation. Chip maker STMicroelectronics shares advanced 0.6% after UBS upgraded the company to buy from reduce.

Oil and precious metals

Oil advanced on speculation colder U.S. weather will increase use of heating fuel. Crude oil for March delivery gained 62 cents, or 1.1%, to $54.85 a barrel in after-hours electronic trading on the New York Mercantile Exchange, and traded at $54.47 at 10:26 in early trade in London. Brent crude for March climbed 66 cents, or 1.2%, to $54.78 a barrel in electronic trading on the ICE Futures exchange, and last traded at $54.33 in London.

Gold declined for a second day in London on weakening demand from India. Gold for immediate delivery dropped 20 cents to $645.90 an ounce in early trade in London. Silver gained 3.5 cents to $13.35 an ounce, palladium added 50 cents to $348.50 an ounce and platinum advanced 50 cents to $1,173.50 an ounce.

Currencies

The dollar was mostly higher against other major currencies in European trading Friday morning. The euro was quoted at $1.2908, unchanged from late Thursday. The British pound traded at $1.9606, down from $1.9711. The dollar bought 121.42 Japanese yen, up from 120.87.

[R]5:00AM Gold and silver prices advanced Thursday on rise in oil stocks.[/R]
February gold ended 10 cents lower at $648.10 a troy ounce on the New York Mercantile Exchange. March silver gained 21.7 cents to $13.49. April platinum closed up $14.90 at $1,188 an ounce and March palladium gained $6.30 to $355.45 an ounce.The most active March copper contract added 5.30 cents to settle at $2.6545 per pound.

The front-month March crude oil contract finished down $1.14 at $54.23 a barrel. February heating oil shed 3.48 cents to $1.5491 a gallon. Front-month gasoline fell 1.75 cents to $1.4441 a gallon and February natural gas ended down 51.6 cents at $6.905 per million British thermal units.

On the New York Board of Trade, March Arabica coffee futures settled up 1.30 cents at $1.1695 a pound, with May up 1.30 cents at $1.2015. March futures on raw sugar in foreign ports settled down 0.07 cent at 10.69 cents a pound, with May off 0.05 cent at 10.88 cents.