Europe Boosted by DaimlerChrysler

Ivaylo
19 Feb, 2007
New York City

European stocks were higher on Monday, with DaimlerChrysler leading the carmakers after news it was in talks with General Motors and other potential bidders over the sale of its US Chrysler division. Food retailers were also higher, led by Sainsbury of Britain after reports of further interest from potential bidders. In early trade, Frankfurt Xetra Dax added 0.3%, the CAC 40 in Paris gained 0.2% and London FTSE 100 climbed 0.3%.

[R]6:30AM Europe advances Monday on bid perspectives from DaimlerChrysler.[/R]
European stocks were higher on Monday. In early trade, Frankfurt Xetra Dax added 0.3% to 6,980.81, the CAC 40 in Paris gained 0.2% to 5,725.23 and London FTSE 100 climbed 0.3% to 6,436.5.

Advancers

DaimlerChrysler gained 3.4% after reports it had received expressions of interest for its Chrysler unit. As potential bidders for the Chrysler unit emerged General Motors and Hyundai, should the German parent company put it up for sale. Other auto stocks were also making progress, with Peugeot shares up 1.4% in France after UBS upgraded the company to neutral from reduce and BMW shares up 1.5% in Germany. Sainsbury shares were up 2% on talk state-owned private equity group Qatar Investment Authority was considering investing in the UK third largest supermarket group. France Carrefour gained 2.6%. Mining shares, which mostly trade in London, were generally higher on Monday as gold prices stayed firm. Rio Tinto shares rose 0.9% and BHP Billiton shares climbed 0.7%.

Decliners

Shares in Norwegian oil and aluminum producer Norsk Hydro slipped 1.2%. The company announced on Monday that Q4 net income fell to $216 million from due to a write-down of $836 million related to its Front Runner field and nine shelf fields in the Gulf of Mexico.

Oil and gold

Oil slipped on Monday to around $59 a barrel, pressured by expectations for warmer weather in the United States and supported by threats to supply in Nigeria. U.S. crude for March delivery was down 30 cents at $59.09 a barrel at 1042 GMT. London Brent crude for April was trading down 4 cents at $58.91 a barrel. Gold opened Monday at a bid price of $671.00 a troy ounce, up from $664.30 late Friday.

Currencies

The euro was little changed Monday against the U.S. dollar on a day that U.S. markets were closed for the President''s Day holiday. In morning European trading the euro bought $1.3138, barely up from $1.3137 in New York late Friday. The pound fell to $1.9501 from $1.9511 as disappointing British retail sales continued to weigh on the currency. The yen remained strong, buoyed by news of strong Japanese economic growth and rising sentiment the country''s central bank would likely raise its key interest rate from 0.25 % later this week. The dollar bought 119.63 yen -- compared with 119.26 on Friday.

[R]5:00AM Gold and silver gained on Friday on stronger oil futures.[/R]
April gold gained $1.40 to $672.80 a troy ounce on the New York Mercantile Exchange, while March silver advanced 2.8 cents to end at $13.99 an ounce. April platinum settled down $6.50 at $1,210.40 an ounce, and March palladium slipped $1 to end at $341.80 an ounce. March copper declined 1.95 cents to close at $2.6445 per pound.

The front-month March crude oil futures contract advanced $1.40 to finish at $59.39 a barrel, a sharp recovery from its intraday low of $57.59 a barrel. March heating oil ended up 4.63 cents at $1.6734 a gallon, while March gasoline settled up 4.81 cents at $1.6453 a gallon. March natural gas added 21.0 cents to finish at $7.503 a million British thermal units.

On the New York Board of Trade, Arabica coffee futures dipped to $1.13 a pound, a three-day low. The March contract closed down 2.10 cents at $1.1320 a pound, with May was off 1.85 cent at $1.16. Futures on raw sugar in foreign ports for March gained 0.02 cent to end at 11.13 cents a pound, with May down 0.05 cent at 10.80 cents.