Retailers Boost Europe

Ivaylo
02 Feb, 2007
New York City

European stocks were higher on Friday on retailers which advanced on merger activities in the sector. Utilities were boosted by German company Eon. The gains were limited, though, after Ericsson posted disapponting results. Trading was cautious as the market awaited US employment data later in the session. By mid morning, the FTSE 100 in London gained 0.4%, Frankfurt Xetra Dax added 0.2%, and the CAC 40 in Paris gained 0.3%.

[R]6:30AM European stocks were higher Friday on strong utility sector.[/R]
European markets were higher on Friday. By mid morning, the FTSE 100 in London gained 0.4% to 6,309.8, Frankfurt Xetra Dax added 0.2% to 6,863.03, and the CAC 40 in Paris gained 0.3% to 5,678.51.

Advancers

Eon, the German utility, gained 3.2% on expectations that the company would be spared a costly bid battle for Endesa of Spain after rival bidder Gas Natural abandoned the race. Sainsbury advanced after a group of investors announced they were considering a bid for the supermarket. Sainsbury shares jumped 14.5%. Carrefour added 3.2% as it stated it was close to signing an agreement with the Indian government to set up retail operations in the country. Ahold, the Dutch retailer which posted a drop in Q4 sales in the previous session, gained 1.7%, while French Casino Guichard added 1.6%.

Q4 profit of Volvo missed forecasts, but an improved outlook from the company and the announcement of an extraordinary pay-out helped boost the shares 2.4%. Domestic rival Scania advanced 3.3%.

Decliners

Ericsson, the Swedish telecoms equipment and networks group, led the decliners, down 5.8%, after reporting Q4 earnings that missed expectations and lowering its 2007 growth forecasts. Nokia, which recently merged its networks systems with that of Siemens, fell 0.9%, while Siemens fell 1%.

Shares in Endesa were down 0.6%, while Acciona, the Spanish construction group that holds 21% of Endesa shares, was 2.2% lower.

Oil and gold

Oil prices recovered Friday on continued cold weather in the United States. Crude oil for March delivery rose 18 cents to $57.48 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude for March delivery gained 29 cents to $57.01 a barrel on the ICE Futures exchange in London. Gold opened Friday at a bid price of $656.64 a troy ounce, down from $658.29 late Thursday.

Currencies

The euro was little changed against the U.S. dollar Friday, declining slightly despite signs that the U.S. manufacturing sector was tightening. The euro bought $1.3018 in morning European trading, down from $1.3021 in New York late Thursday. The British pound shed $1.9672 from $1.9677, while the dollar rose to 120.88 Japanese yen from 120.66 yen.

[R]5:00AM Gold futures advanced on Thursday on oil strength and dollar weakness.[/R]
April gold ended up $5.10 to $663 after hitting a high of $667, the contract strongest intraday level since Aug. 9. March silver gained 15.5 cents to close at $13.725 an ounce. April platinum advanced $10.50 to end at $1,192.80 an ounce and March palladium closed $4.35 higher at $344.90 an ounce. March copper dropped by 2.5%, surrendering 6.4 cents, to close at $2.5305 a pound.

The March crude oil contract ended 84 cents lower at $57.30 a barrel. Natural gas for March delivery fell 1.8%, losing 13.7 cents to close at $7.53 per million British thermal units. March heating oil finished down 2.49 cents at $1.6589 a gallon and March gasoline closed down 2.71 cents at $1.5253 a gallon.

On the New York Board of Trade, March Arabica coffee futures advanced 1.10 cents to end at $1.1875 a pound, with May up 0.85 cent at $1.2175. Futures on raw sugar in foreign ports for March gained 0.03 cent to close at 10.63 cents a pound.