Europe Rises on Takeover Talk

Ivaylo
04 May, 2007
New York City

European markets managed to stay in positive territory in early trading on Friday ahead of the release of key U.S. jobs data, with miners including BHP Billiton pricing in an advance in Sydney and recorded music group EMI, as well as Reuters, provider of financial data, rallying on new takeover talk. The major indices were higher including the FTSE 100 which rose 0.3% and the French CAC 40, which also gained 0.2%, while the German DAX 30 was a bit worse, trading flat.

[R]6:30AM European markets advance Friday on bid talk in Reuters and EMI.[/R]
European markets advanced in mid-morning trade on Friday. The major indices were higher including the FTSE 100 which rose 0.3% at 6,560.00 and the French CAC 40, which also gained 0.2% at 6,015.21, while the German DAX 30 was a bit worse, trading flat at 7,476.56. National benchmarks advanced in 13 of the 16 western European markets that were open.

Advancers

Reuters soared 30% after it said it received a preliminary takeover approach from an unidentified suitor. The board of Reuters confirms the preliminary approach from a third party which may or may not lead to an offer being made for Reuters.

Music publishing group EMI rallied 9.2% after saying on Friday that it has received a number of preliminary approaches to acquire the group. The firm announced there can be no certainty that any of the approaches will results in an offer.

U.K. building materials group Hanson surged 5%, extending a 20% advance on Thursday when HeidelbergCement announced it was mulling over a takeover approach. Goldman Sachs upgraded Hanson to neutral from sell after the announcement from the German firm.

Gainers included mining large-caps BHP Billiton up 3%, and Rio Tinto up 3.8%, as U.K. investors priced in a similar move in record-hitting Australian markets. Shares of BMW gained 2.8% just a day after reporting a 38% decline in first-quarter profit.

Decliners

Deutsche Boerse, the operator of the Frankfurt stock exchange, said yesterday first-quarter net income rose 19% to 192.3 million euros. That was less than the 195 million euro median estimate of four analysts surveyed by Bloomberg. The stock fell 0.8%

Shares of Nokia the largest mobile phone maker in the world, dropped 2.4% after it also traded without dividend rights.

Commodities

Crude oil erased earlier gains and declined near $63 a barrel in New York. Crude oil for June delivery shed 16 cents to $63.03 a barrel in after-hours electronic trading on the New York Mercantile Exchange in early trade in London. Brent crude oil for June settlement gained 23 cents to $66.29 a barrel in electronic trading on ICE Futures exchange.

Gold declined, giving up recent gains, as higher equity prices lowered demand for the precious metal as an alternative investment. Silver was little changed. Gold for immediate delivery fell $1.35, or 0.2 percent, to $681 an ounce, while silver was little changed at $13.41 an ounce.

Currencies

The dollar declined against most other major currencies in European trading Friday morning. The euro traded at $1.3559, up from $1.3554 late Thursday in New York. The British pound traded at $1.9861, down from $1.9876. The dollar bought 120.31 Japanese yen, down from 120.44.

[R]5:00AM Copper futures surge Thursday, gold and silver edge higher on fund-buying.[/R]
The most active July copper contract rallied 8.20 cents higher to end at $3.7265 per pound on the New York Mercantile Exchange. June gold addedp $9.30to close at $684.40 a troy ounce, while July silver advanced 17.5 cents to finish at $13.51. July platinum settled up $11.70 at $1,310.80 an ounce, while June palladium ended up $1.55 at $376.50 an ounce.

The June crude oil contract declined 49 cents to close at $63.19 a barrel after trading at $64.09 a barrel. The June heating oil contract lost 0.73 cent to finish at $1.8453 a gallon. June gasoline edged 1.50 cent higher at $2.2476 a gallon. June natural gas settled up 21.7 cents at $7.947 per million British thermal units.

On the New York Board of Trade, July Arabica coffee dipped 0.30 cent to end at $1.0440 a pound. Most-active July cocoa settled up $24 at $1,879 a metric ton. Futures on raw sugar in foreign ports for July climbed 0.15 cent to end at 9.29 cents a pound, with October up 0.11 cent at 9.54 cents. May corn gained 7.75 cents to $3.79.75 per bushel, July settled 7.25 cents higher at $3.89.25.