Banks Hold Europe Up

Ivaylo
08 Feb, 2007
New York City

Banking stocks, which were the leading advancers in previous sessions, were under pressure Thursday as traders took profits ahead of interest rate decisions. The markets expect both BoE and the ECB to leave the rates unchanged. Some banks gained, though, including ABN Amro, Julius Baer of Switzerland. By mid morning, Frankfurt Xetra Dax was unchanged, the CAC 40 in Paris edged up slightly and London FTSE 100 was 0.2% lower.

[R]6:30AM European stocks were flat on Thursday morning on profit-taking.[/R]
European markets were flat on Thursday morning. By mid morning, Frankfurt Xetra Dax was unchanged at 6,914.53, the CAC 40 in Paris inched up to 5,704.11 and London FTSE 100 was 0.2 per cent lower at 6,358.9.

Advancers

ABN Amro gained 1.6% after posting a 7.6% gain in annual net profit that topped market forecasts. The bank intends to raise shareholder returns in 2007 after concentrating on acquisitions and restructuring over the past two years. Julius Baer, Swiss bank, gained 6.1 per cent after reporting a forecast-topping 35 per cent rise in full-year net profit on growth in newly-developed Asian markets. MAN of Germany rose 3.4 per cent after Goldman Sachs updated the stock to buy and JPMorgan raised its price target. Fixed line telecoms groups advanced after After BT Group of Britain announced robust Q3 core earnings and a bright guidance as it continued to add new broadband customers. BT shares gained 3.8 per cent, while Deutsche Telekom gained 1.1 per cent, Hellenic Telecom rose 1.8 per cent and Telekom Austria climbed 1.4 per cent. Renault, the French carmaker, reported its 2006 operating margin declined on last year but that it achieved its 2.5 per cent target through cost cuts and improved quality. Renault shares gained 1.1 per cent.

Decliners

Altadis, the Spanish tobacco company, shed 2.8% after Imperial Tobacco of Britain said it its acquired US group Commonwealth Brands. Altadis had been supposed to be top of Imperial acquisition list - earlier on Thursday UBS had downgraded Imperial on the expectation it would launch a hostile bid. Syngenta, Swiss agrochemicals maker, posted a 12 per cent rise in full-year net profit which missed expectations, as sales declined 1 per cent. Shares fell 2.3 per cent. Dutch office supplies wholesaler Buhrmann plunged 10.1 per cent after falling short of expectations with Q4 underlying profit

Oil and gold

Oil prices recovered toward $58 on Thursday after cold weather cut fuel stocks in United States. U.S. Crude oil futures gained seven cents to $57.78 a barrel in early trade in London. Brent crude gained 20 cents to $57.43. Gold fell for a second straight day on signs supply to refineries is growing faster than demand from investors seeking an alternative to the dollar. Gold for immediate delivery dropped $1.90, or 0.3%, to $649.55 an ounce in early trade in London.

Currencies

The euro declined against the U.S. dollar on Thursday as markets awaited a decision by the European Central Bank on interest rates. The 13-nation euro bought $1.2986 in morning European trading, down from $1.3006 in New York late Wednesday. The British pound fell slightly to $1.9676 from $1.9692. The dollar gained traded at 121.09 Japanese yen, up from 120.66 yen on Wednesday.

[R]5:00AM Platinum surges Wednesday, while gold and copper decline.[/R]
April gold lost $1.40 to settle at $657.30 a troy ounce, while silver futures gained 3.5 cents to end at $13.71 an ounce. Platinum futures breached the $1,200 an ounce level. The contract later closed at $1,203, up $12.70. March palladium gained $1.15 finish at $345.20 an ounce. March copper contract shed 4.15 cents to settle at $2.4550 per pound.

March crude oil declined $1.17 to end at $57.71 a barrel after reaching $59.85. March heating oil also dipped 2.48 cents to finally end at $1.6661 a gallon and March gasoline slipped 3.10 cents to close at $1.5415 a gallon. March natural gas bucked the trend and settled up 9.3 cents at $7.709 per million British thermal units.

On the New York Board of Trade, March Arabica coffee futures advanced 0.35 cent to end the session at $1.1685 a pound. March futures on raw sugar in foreign ports edged 0.07 cent lower to finally stand at 10.12 cents a pound.