Europe Higher As Eon Gives Up Endesa

Ivaylo
03 Apr, 2007
New York City

European markets gained on Tuesday as the battle to take over Endesa ended with Eon coming to an agreement with Enel and Acciona to divide the Spanish utility between them. Other advancers included miners BHP Billiton Ltd. and Rio Tinto Group. By mid morning, Frankfurt Xetra Dax added 0.9%, the CAC 40 in Paris gained 0.6% and London FTSE 100 climbed 0.5%.

[R]6:30AM Europe was higher Tuesday on takeover activities, miners.[/R]
European markets were higher on Tuesday. By mid morning, Frankfurt Xetra Dax added 0.9% to 6,997.43, the CAC 40 in Paris gained 0.6% to 5,678.9 and London FTSE 100 climbed 0.5% to 6,345.3. National benchmarks rose in all 18 markets in western Europe.

Advancers

German utility Eon abandoned its attempt to take full control over Spanish Endesa after coming up against too many obstacles, including counter bids and stakebuilding by rivals and tough regulatory conditions imposed by Spanish authorities. Eon conceded defeat to Enel of Italy and Spanish builder Acciona. Eon shares were up 7%, while Enel added 2.1% and Acciona added 4.3%.

Scottish & Southern Energy, the third-largest gas and electricity supplier in the UK, rallied 1.7%. Centrica, the biggest energy supplier in the UK, climbed 1.8 %.

BHP, the world largest mining company, gained 1.7 %, while Rio Tinto, the world third-largest mining company, climbed 2.4 %. Xstrata, the world fourth-largest copper producer, advanced 2.8%.

German tyre and car parts maker Continental rose 3.9% on speculation it was the target of an unnamed private equity bid.

Telecom Italia continued its climb higher following interest from AT&T and America Movil in buying stakes in the company. After gaining 10% in the previous session, the shares were up a further 1.5%.

Decliners

There were no major decliners.

Oil and gold

Crude oil fell as the U.K. planned talks with Iran on the release of 15 British sailors and marines, easing concern the dispute would disrupt crude supplies from the Middle East. Crude oil for May delivery declined $1.20, or 1.8%, to $64.74 a barrel in after-hours electronic trading on the New York Mercantile Exchange and was at $64.88 in early trade in London time. Oil has risen about 5.2% since the sailors and marines were seized, on March 23. Brent crude for May settlement fell as much as 88 cents, or 1.3%, to $67.86 a barrel in electronic trading on the ICE Futures exchange. Gold traded in London at $663.10 per troy ounce, up from $658.40 late Monday.

The dollar was higher against most other major currencies in early European trading Tuesday. The euro traded at $1.3354, down from $1.3373 late Monday. The British pound traded at $1.9761, down from $1.9775. The dollar fetched 118.53 Japanese yen, up from 117.57.

[R]5:00AM Corn plummeted, while gold futures bounced back on Monday.[/R]
May corn ended 19.75 cents lower at $3.5475 per bushel, July fell 19 cents to $3.6650 a bushel, and December dropped 14 cents to $3.6950 a bushel. June gold advanced $2.50 to finish at $671.50 a troy ounce, but May silver shed 10 cents to settle at $13.35 an ounce. July platinum lost $5.80 to close at $1,249 an ounce, while June palladium dipped $3.55 to end at $353.70 an ounce. In copper trading, May contract gained 3.30 cents to settle at $3.1790 per pound.

May crude oil added 7 cents to end higher at $65.94 a barrel, but well below the high of $66.69. May gasoline finished 1.52 cents lower at $2.0428 a gallon, while May heating oil futures closed 1.44 cents lower at $1.8625 a gallon. Natural gas for May delivery settled 5.9 cents lower at $7.671 per million British thermal units.

Arabica coffee futures also slipped, canceling out early gains as funds and origins sold. May coffee closed 0.65 cents lower at $1.0860 a pound, with July off 0.65 cents to finish at $1.1155 a pound. On the New York Board of Trade, futures on raw sugar in foreign ports sank to 1.5-year lows. May sugar settled 0.18 cents lower at 9.70 cents a pound, with July off 0.13 cents to finish at 9.87 cents a pound.