Property Stocks Weigh on Europe

Ivaylo
20 Feb, 2007
New York City

European markets were lower on Tuesday after real estate companies eased on reports of slowing growth in property investment markets, while oil companies declined after crude prices dipped overnight. EMI added as there are reports of bid interest from Warner. Some auto makers also advanced. By mid morning, Frankfurt Xetra Dax shed 0.1%, the CAC 40 in Paris lost 0.3%, while London FTSE 100 was flat.

[R]6:30AM European markets were lower on Tuesday on weak real estate stocks.[/R]
European equity markets declined on Tuesday. By mid morning, Frankfurt Xetra Dax shed 0.1% to 6,978.84, the CAC 40 in Paris lost 0.3% to 5,723.81, while London FTSE 100 was flat at 6,444.3.

Advancers

EMI added 7.3%. EMI announced it received an approach from Warner. EMI said there was no certainty the approach would lead to a takeover offer. Some auto makers gained. Volkswagen, the German carmaker, gained 3.5% as expectations were raised that the company would lift its dividend when it posts its full-year numbers later in the session. Volvo added 1.8% after it agreed to buy Nissan Diesel to add production in Asia, the world fastest- growing economic region. Shareholders in Nissan Diesel, fourth-largest truck maker in Japan will receive 540 yen a share. That is 22% higher than the closing price yesterday. Volvo already owns 19% of Nissan Diesel.

Decliners

Real Estate companies dipped after Land Securities of the UK posted a 2.2% increase in its net asset value per share, but said higher interest rates were beginning to have a cooling effect on the property market. Shares in Land Securities shed 2.3%, while Unibail of France lost 1.7% and Rodamco Europe, listed in Amsterdam, dropped 0.5%. Oil companies retreated after crude prices fell by around 1% overnight. Total of France was down 0.5%, while Norwegian Statoil lost 0.6%.

Crude oil and gold

Oil prices gained on Tuesday after shedding 1% a day earlier as traders were torn between supply anxieties in Nigeria and the nearing end of winter oil demand in top consumer the United States. Crude oil also recovered some of the losses on Monday, trading at $58.67 a barrel on the Globex electronic platform. London Brent crude rose 31 cents to $58.45 a barrel. The New York Mercantile Exchange did not issue a settlement price on Monday as its trading floor was closed for the Presidents Day holiday. Gold for immediate delivery fell $1.90, or 0.3%, to $668.85 an ounce in early trade in London.

Currencies

The euro bought $1.3141 in morning European trading, slightly up from its level of $1.3135 in New York late Monday, hitting six-week highs on worries about nuclear issues and Iran. The British pound rose to $1.9489 from $1.9453. The dollar bought 119.94 yen, compared with 119.56 yen Monday.

[R]5:30AM Gold rises, silver and platinum decline Tuesday on weaker dollar.[/R]
Gold for immediate delivery rose as much as 90 cents, or 0.1%, to $671.65 an ounce, and traded at $671.05. Gold yesterday rose as high as $673.55, its highest since July 17. Some financial markets in Asia, including China, are closed for the Lunar New Year holidays. Silver dropped 4 cents to $13.965 an ounce. Palladium declined $2 to $338.50 and platinum slipped $2.50 to $1,213.50. Copper on the London Metal Exchange rose as much as $40, or 0.7%, to $5,845 a metric ton in after-hours trading and was at $5,845. Prices have gained 19% in the past year

Crude oil for March delivery was at $58.56 a barrel, up 3 cents, in after-hours electronic trading on the New York Mercantile Exchange. The more active April contract dropped 2 cents to $59.21 after falling 1.1% yesterday. Brent oil for April settlement rose 9 cents, or 0.2%, to $58.23 a barrel on the ICE Futures exchange in London. Gasoline for March delivery was at $1.6499 a gallon in after-hours trading, after gaining 0.1% to $1.6471 yesterday.