Oil in Focus at U.S. Opening

Elena
05 Sep, 2005
New York City

Asian markets opened higher led by markets in South Korea and Hong Kong, after European markets close to a two-week high. Spain's utility Endesa receives $29 billion bid from ENDESA. After six days of Hurricane Katrina less than 50% of oil and gas production is restored after similar time period in the aftermath of Hurricane Ivan in 2004.

U.S. MARKET AVERAGES

U.S. stock markets are closed on Monday for the Labor Day national holiday.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks ended mixed, awaiting U.S. markets reopening on Tuesday as they are closed for the Labor Day national holiday. The Nikkei was near a four-year high at intraday after the stocks opened higher, but later rebounded and eventually finished up 0.3%. Stocks were boosted by declining crude-oil prices and a poll by the Nikkei, suggesting that the ruling party may extend its current majority after the elections on Sept. 11. Across the region, Hong Kong’s Hang Seng remained almost flat, while South Korea’s Kospi shed 0.1%.

European markets finished the session higher after a light trading day as the U.S. markets were closed for the Labor Day national holiday. The German stock market was the main player across the region, rising 1.5% after a political TV debate on whether Chancellor Schroeder should stay in office. Stocks were also helped by Volkswagen which rose 3% on announcement of jobs-cut plan and UBS which added 0.9% on sell-off deals. The French CAC 40 climbed 0.6%. London’s FTSE 100 gained 0.2%.

ENERGY, METALS, CURRENCIES

Oil prices declined, reflecting the decision of the IEA to release 60 million barrels from strategic reserves. London Brent for October delivery fell $1.41to $64.65a barrel. The Nymex was closed Monday for the Labor Day holiday. On September 2, light sweet crude dropped 2.7% to $67.57.

Gold advanced in European trading. In London gold closed at $445.00 per troy ounce, up from $443.70. Silver closed at $7.05, up from $6.99.

The U.S. dollar was mixed in European trading. The euro was quoted at $1.2521, down from $1.2544. The dollar bought 109.16 yen, down vs. 109.64. The British pound stood at $1.8443, up from $1.8436.

EARNINGS NEWS

Swiss Life, insurance company, announced that first-half net profit advanced to SFr463 million, up vs. SFr358 million, for the year-ago period. Adjusted gross written premiums were up 6% to SFr11.6 billion, and a SFr100 million tax provision release lifted results too.

Taylor Nelson Sofres, market research group, reported first-half adjusted pre-tax profit went up almost 11% to 35.9 million pounds on 3.1% revenue growth in syndicated services and Continental Europe and Asia Pacific custom businesses. The U.S. and U.K. customer businesses did worse.

Travis Perkins, building materials group, announced first-half profit was up 8.3% to 74.5 million pounds on 41.3% revenue growth helped by the acquisition of home improvement retailer Wickes.

Amlin, marine and aviation insurer posted a first-half pre-tax profit rise to a record 134.1 million pounds, with combined ratio, a measure of claims and expenses to premiums, falling to 69% from 72%. The company provisionally estimated that Hurricane Katrina net losses are at $110 million.

William Hill betting group, announced that first half adjusted profit dropped 6% to 123.9 million pounds, damaged by sporting results and the Euro 2004 tournament in the year-earlier period. It lifted its interim dividend by 11% to 6.1 pence a share, The company expects to return 200 million to 300 million pounds to shareholders in the next 18 months.

CORPORATE NEWS

Volkswagen, German automaker, announced a plan to cut 10,000 of its 100,000 jobs countrywide, throwing the blame to labor costs, high oil prices, and slowing German economy. According to estimates this move could save 560 million euros.

Samsung Electronics plans to double the production capacity of a factory, currently under construction, to make liquid crystal displays for large flat-screen TV sets. This move will speed up the price decline of LCD TVs and give the company a better position among its competitors in the industry.

UBS AG announced a decision to sell three private banks for 5.6 billion Swiss francs, or $4.6 billion in cash and stock. These are Ehinger & Armand von Ernst Ltd; Ferrier Lullin & Cie; and Banco di Lugano , as well as asset manager GAM to Julius Baer HoldingAG. The deal will create Switzerland's largest independent private bank. Under the deal, UBS will receive 3.8 billion francs in cash and a 21.5% stake in Julius Baer.