European Markets Open Lower

Ivaylo
09 Mar, 2007
New York City

European markets were lower on Friday as drugs, metals and mining groups declined, and although the losses were not as severe as they were last week, investors were cautious of calling an end to the recent market volatility. A disappointing outlook from Airbus owner EADS and a negative broker note on the pharmaceutical sector added to pressure. By mid morning, Frankfurt Xetra Dax fell 0.5%, the CAC 40 in Paris shed 0.8% and London FTSE 100 lost 0.4%.

[R]6:30AM Europe was lower Friday on weak metal, drug and mining sectors.[/R]
European markets were off to a weak start on Friday. By mid morning, Frankfurt Xetra Dax fell 0.5% to 6,677.11, the CAC 40 in Paris shed 0.8% to 5,482.19 and London FTSE 100 lost 0.4% to 6,203.8.

Advancers

Thales, the French defence electronics group, topped the earnings table after posting a better-than-expected 4.5% increase in full-year operating profit, while guiding strong revenue growth for the next two years. Thales shares added 4.1%. Sanofi-Aventis advanced 0.1% after Goldman upgraded it to buy, saying concerns over Plavix and Lovenox are now priced in. Ahold, the Dutch retailer, was up 1.6% as bids circulated in for the company US Foodservice division, valued at around $6 billion.

Decliners

EADS, the European aerospace group, fell 1.8% after losses at its Airbus unit were largely resposible for an 86% drop in 2006 operating profits. The pharmaceuticals sector was led lower after Goldman Sachs lowered its rating on the UK GlaxoSmithKline from neutral to sell. GlaxoSmithKline dropped 1.7%. Meanwhile Novartis, the Swiss drugmaker, fell 2.1% as investors took profits on its recent strong performance.

Oil and gold

Oil prices were almost flat in Asian trading Friday as market participants looked for trading cues from U.S. jobs data due later in the day. Crude oil for April delivery dropped 6 cents to $61.71 a barrel in electronic trading on the New York Mercantile Exchange, mid-afternoon in Singapore. Brent crude for April delivery fell 3 cents a barrel on London ICE Futures Exchange. Gold opened Friday at a bid price of $652.90 a troy ounce, up from $651.20 late Thursday.

Currencies

The euro gained slightly against the U.S. dollar on Friday before US expected release of key economic data. The euro bought $1.3147 in morning European trading, up from $1.3135 the night before in New York. The British pound dropped slightly to $1.9290 from $1.9293 the night before, while the dollar rose to purchase 117.43 Japanese yen from 117.14 in New York.

[R]5:00AM Copper rallied Thursday, while gold and silver gained modestly.[/R]
On the New York Mercantile Exchange, March copper gained 5.35 cents to settle at $2.8255 per pound, while most active May added 5.15 cents to $2.8335. April gold edged up $2.60 to end at $655.50 a troy ounce, while May silver settled up 1.5 cents at $13.12. April platinum reached $1,218.80, which is its strongest level since Friday, before ending at $1,214.50 an ounce, up $22. June palladium settled down 70 cents at $353.05 an ounce.

April gasoline advanced 3.06 cents at $1.9261 a gallon, the highest for a front month contract since Aug. 22. The front-month April crude oil contract lost 18 cents to close at $61.64 a barrel, after earlier hitting $62.30. April heating oil fell 0.61 cent to $1.7613 a gallon. April natural gas settled down 12.7 cents at $7.239 a million British thermal units.

On the New York Board of Trade, May Arabica coffee futures ended up 0.20 cent at $1.1240 a pound, with July up 0.20 cent at $1.1530. Futures on raw sugar in foreign ports closed down 0.09 cent at 10.59 cents a pound, with July off 0.07 cent at 10.51 cents. March corn ended 3.75 cents lower at $4.12 per bushel, May settled 3 cents lower at $4.21.50, and December finished 1.50 cent higher at $4.10.75.