Alcoa Gains on Possible Bid

Elena
13 Feb, 2007
New York City

According to reports, BHP Billiton and Rio Tinto are separately considering bids for the aluminum producer, but haven''t approached Alcoa''s board yet. The report suggests that the metals giants want to boost production with aluminum prices hitting records. Shares in the Dow component rose 10% in Frankfurt, while BHP Billiton and Rio Tinto each gained 1.3% in midmorning London trading.

[R]8:00 AM Shares in Alcoa rose 7% in pre-market trading on new it’s a bid target.[/R]
Alcoa ((AA)) climbed 7% in pre-market trading following news that mining giants BHP Billiton and Rio Tinto are separately considering bids for the aluminum producer, but haven''t approached Alcoa''s board yet. According to the report, the metals giants want to boost production with aluminum prices hitting records. Shares in the Dow component rose 10% in Frankfurt trading to $36.32. Shares of BHP Billiton ((BHP)) and Rio Tinto ((RTP)) each advanced 1.3% in midmorning London trading. It was also reported that BHP executives feature prominently on Alcoa''s own wish-list for a new chief executive, including departing BHP Billiton CEO Chip Goodyear. Alcoa''s own Helmut Wieser also is a candidate for Alcoa''s CEO. Alcoa''s current CEO is due to retire next year.


[R]6:30AM Europe advances Tuesday on strong gains in auto and airline stocks.[/R]
European markets were higher on Tuesday. By mid morning, Frankfurt Xetra Dax gained 0.4% to 6,882.86, the CAC 40 in Paris added 0.4% to 5,664.97 and London FTSE !00 climbed 0.2% to 6,366.4.

Advancers

Automaker Peugeot shares were up 1.1% and airline Ryanair Holdings shares 2.2% higher in the transport segment as crude for March delivery closed down $2.08 at $57.81 a barrel on the New York Mercantile Exchange on Monday. Norway Renewable Energy Corp gained 4.5% after reporting a better-than-expected 86% jump in Q4 core earnings. French telecoms and construction group Bouygues gained 1.4% after reporting a 10% rise in 2006 revenues, beating expectations, helped by sales growth at its telecoms unit.

Decliners

Sanofi-Aventis, the French drugmaker, fell 1.9% despite beating expectations with its Q4 operating profit and forecasting further growth for 2007. UBS shares lost 0.8% after the banking company reported a 47% drop in Q4 net profit but also said that it would buy back up to 10% of its shares. British Land shares fell 2.1%, Land Securities shares dipped 1.6% and Liberty International shares lost 2.2%.

Oil and gold

Oil slipped below $58 a barrel on Tuesday, extending a $2 drop from the previous day on signs that OPEC will refrain from further oil supply cuts when it meets in March. U.S. crude was off 23 cents at $57.58 a barrel. London Brent crude slipped 12 cents to $56.48 a barrel. Gold traded at $665.90 an ounce on Tuesday, up $1.30 an ounce from its close of $664.60 on Monday.

Currencies

The euro advanced after a report showed German economic growth unexpectedly quickened in Q4, underpinning expectations the European Central Bank will keep raising interest rates. The euro gained to $1.300 in early trade in London from $1.2966 in New York yesterday. It was also at 157.75 yen from 158.13. The yen traded at 121.34 against the dollar from 121.94 late in New York yesterday.