Unilever, Sanofi, Deutsche Bank Fall

123jump.com Staff
31 Jul, 2008
New York City

European markets closed mixed but traded with a negative bias. Mixed earnings from Deutsche Bank, Shire, Sanofi-Aventis, Unilever and AstraZeneca dominated trading sentiment in the region. Deutsche Bank reported higher than expected write down in mortgage assets and earnings fell sharply in the quarter. Unilever earnings declined on stronger euro and higher restructuring costs. The drug maker Sanofi-Aventis second quarter sales rose 5.2% but adjusted earnings fell 4.4%.

[R]2:30PM New York – European stocks closed mixed after a string of weak earnings from banks and consumer products companies.[/R]

Earnings news in the region drove stocks and benchmark indexes. Earnings from Deutsche Bank, Sanofi-Aventis SA, AstraZeneca, Shire, Unilever and BSkyB dominated trading sentiment.

Deutsche Bank reported second quarter earnings decline of 64% to 649 million euros or 1.27 euros from 1.78 billion euros or 3.60 euros. The German bank wrote down 2.3 billion euros in mortgage assets in the quarter with a total write down of 7.3 billion euros. The closely monitored tier 1 ratio rose to 9.3% at the end of the second quarter from 9.2% at the end of the first quarter in March.

The drug maker Shire Limited reported second quarter revenue rose 35% to $776 million and loss per ADS declined to 44 cents from $9.93 a year ago. The company lifted its revenue increase guidance for the full year to 20% from its earlier forecast of mid-teen increase in sales.

Sanofi-Aventis SA reported second quarter sales increased 5.2% to 6.69 billion euros on a sharp increase in sales in markets outside Europe and the U.S. Diabetic treatment insulin product Lantus sales rose 27.2% to 576 million euros in the period.

Adjusted net income in the quarter fell 4.4% to 1.605 billion euros ad earnings per share declined 0.8% to 1.23 euros. The company estimated full year adjusted earnings per share to increase at 8% based on the constant dollar/euro rate at the end of 2007 to 1.371.

Unilever reported second quarter revenue rose 6% at constant currency rate or declined 1% at current rates to 10.374 billion euros and net profit fell 19% at current currency rate or declined 12% at constant currency rate to 978 million euros. Earnings per share in the quarter fell 12% at constant currency rate to 32 euro cents per share. Higher restructuring charges and stronger euro dragged operating profit 5% lower in the quarter.

CAC-40 Gainers & Losers

Sanofi-Aventis led the decliners in the CAC 40 index with a loss of 4.23% to $45.30 followed by losses in Dexia of 3.24% to $8.66, in Pernod Ricard of 2.83% to $56.25, in Cap Gemini of 2.83% to $40.85 and in Air France-KLM of 2.74% to $15.96.

EDF led the gainers in the CAC 40 index with a rise of 2.91% to $55.87 followed by increases in France Telecom of 2.63% to $20.30, in Unibail-Rodamco of 2.04% to $143.75, in Total of 1.15% to $49.75 and in Societe Generale of 0.61% to $59.37.

DAX Gainers & Losers

Of the 30 stocks in DAX index 16 stocks gained and 14 declined.

Deutsche Post-RG led the decliners in the Dow Jones Industrial Average with a loss of 3.48% or $0.54 to $14.96 followed by losses in Metro AG of 3.37% or $1.26 to $36.11, in BASF SE of 2.32% or $0.96 to $40.43 and in Deutsche Postbank of 2.26% or $1.05 to $45.50.

Deutsche Telekom led the gainers in the Dow Jones Industrial Average index with a rise of 2.69% or $0.29 to $11.09 followed by increases in Deutsche Boerse of 2.38% or $1.69 to $72.69, in Bayer AG of 2.17% or $1.18 to $55.64, in Hypo Real Estate of 1.92% or $0.34 to $18.04 and in RWE AG of 1.78% or $1.35 to $77.09.

Europe Markets Review

In London FTSE 100 Index closed lower 8.80 or 0.16% to 5,411.90, in Paris CAC 40 Index decreased 8.19 or 0.19% to close at 4,392.36 and in Frankfurt DAX index higher 19.44 or 0.30% to close at 6,479.56. In Zurich trading SMI increased 32.30 or 0.45% to close at 7,141.21.