European Markets Fall on Fraport, Arcelor, RBS

123jump.com Staff
12 May, 2009
New York City

European markets edged lower on a weakness in banks and industrials. Retailers in UK gained. Fraport AG and ThyssenKrupp dropped on weak earnings outlook. ArcelorMittal guided global steel sales to drop as much as 20%.

[R]7:00PM London, 8:00 PM Frankfurt, Paris – European markets edged lower on a weakness in banks and industrials. Retailers in UK gained. Fraport AG and ThyssenKrupp dropped on weak earnings outlook. ArcelorMittal guided global steel sales to drop as much as 20%.[/R]

European markets closed lower as financials, miners and industrials declined. Investors are showing healthy skepticism of the recent rally and are wondering if stocks have moved too high too fast.

The Office of National Statistics in UK reported that jobless claims in April increase 27,000 and total number of unemployed increased 244,000 in the three months to March increased to 2.22 million.

Banks in UK declined, industrials in Germany were lower and banks and retailers in France declined.

RBS fell 6% to 43.50 pence, Barclays declined 6.5% to 268 pence and Lloyds Banking Group Plc plunged 10% to 89.1 pence. Credit Agricole declined 3.1% to 11.15 euros and Societe Generale dropped 1.5% to 36.81 euros.

ArcelorMittal ((MT)) dropped 4% to 19.55 euros after the company chairman Laxmi Mittal said that global steel demand may drop as much as 20% in the current year.

UK retailers increased after the industry association indicated that April sales at stores open a year or longer increased 4.6%. Tesco Plc increase 3.7% to 352.50 pence, Next Plc gained 2.9% to 1,550 pence and William Morrison advanced 4.1% to 245.75 pence.

ThyssenKrupp plunged 6% to 16.35 euros after it forecasted several hundred million euros loss for the year. Deutsche Boerse AG increased 3% to 57.26 after it reported better than expected earnings.

Fraport AG declined 6% to 30 euros after the Frankfurt airport operator reported first quarter revenues declined 14% to €452 million and net income fell 25.4% to €22.3 million and earnings per share of 26 euro cents. The group also estimated full year operating earnings to between 500 and 530 million euros from the revised earnings of 590 million euros in the year ago.

The debt to leverage ratio is expected to increase to 75% in the fiscal year.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 59 increased, 41 declined and 2 were unchanged.

Lloyds Banking Group plc decliners in the FTSE 100 index with a loss of 10.27% followed by losses in Lonmin Plc, of 8.56%, in Rio Tinto plc, 6.94%, in Barclays PLC of 6.45% and in The Royal Bank of Scotland Group plc of 5.64%.

Fresnillo Plc led gainers in the FTSE 100 index with a rise of 4.82% followed by increase in International Power plc of 4.35%, in Amlin plc of 4.15%, in Tesco PLC of 3.68, in Serco Group plc of 3.55%, in GlaxoSmithKline plc of 3.03%.

DAX Index Movers

ThyssenKrupp AG led the decliners in the DAX index of 6.82% followed by losses in Salzgitter AG of 6.03%, in Deutsche Bank RG of 4.36%, in Man AG of 3.86%. in Fresenius SE of 3.35%.

Adidas AG led gainers in the DAX index with a rise of 4.18% followed by gains in Deutsche Boerse AG of 3.58%, in Henkel AG & Co KGaA of 2.51% and Deutsche Telekom AG of 2.40%.

CAC-40 Index Movers

Dexia SA led the decliners in the CAC-40 index of 8.26% followed by losses in Vallourec SA of 5.03%, in ArcelorMittal of 4.26%, in Societe Generale SA of 3.89% and in EADS NV of 3.26%.

Lagardere SCA led gainers in the CAC-40 index with a rise of 2.99% followed by gains in Veolia Environmental Services of 2.82%, in France Telecom S.A. of 2.65% in Carrefour SA of 2.26.

Earnings Review

Babcock International Group PLC, an engineering support services company said full-year revenues rose 22% to £1,901.9 million from £1,555.9 million a year ago. Net profit for the quarter rose 7% to £72.0 million or £37.16 per diluted share compared to net profit of £67.3 million or £29.43 per share a year ago.

Imperial Tobacco Group PLC, an international tobacco company said first-half revenues rose 53% to £12.4 billion from £8.1 billion a year ago. Net loss for the quarter was £149 million or £14.7 per diluted share compared to net profit of £428 million or £50.4 per share a year ago.

InterContinental Hotels Group PLC, a worldwide owner, manager and franchisor of hotels and resort said first quarter revenues fell 24% to $342 million from $448 million a year ago. Net profit for the quarter fell 56.5% to $27 million or $9.5 per diluted share compared to net profit of $62 million or $21.0 per share a year ago.

Lonmin Plc, the platinum miner said first-half revenues fell 52% to $436 million from $907 million a year ago. Net loss for the quarter was $112 million or $71.2 per diluted share compared to net profit of $283 million or $180.5 per share a year ago.

Aareal Bank AG, a Germany-based real estate bank said first quarter net interest income rose 6.5% to €114 million from €107 million a year ago. Net profit in the quarter fell 46% to €7 million compared to net profit of €13 million a year ago.

A.P. Moeller-Maersk A/S, the world’s largest container line said first quarter revenues fell 12% to DKK63 billion. Net loss in the quarter was DKK2.13 billion compared to net profit of DKK5.22 billion a year ago.

European Aeronautic, Defence & Space Co, the region’s biggest aerospace company said first quarter revenues fell 14% to €8.5 billion from €9.9 billion a year ago. Net profit in the quarter fell 40% to €170 million or €0.21 per diluted share compared to net profit of €285 million or €0.35 per share a year ago.

Mediobanca Group, Italy’s biggest publicly traded investment bank first quarter net interest income rose 7.6% to €226 million from €210 million a year ago. Net loss in the quarter was €61 million compared to net profit of €143 million a year ago.

Saras SpA, owner of the Mediterranean region’s biggest refinery said first quarter revenues fell 40% to €1.23 billion from €2.05 billion a year ago. Net profit in the quarter fell 26% to €58.2 million or €6.28 per diluted share compared to net profit of €78.3 million or €8.24 per share a year ago.

TUI AG, German tourism and shipping company said first quarter revenues fell 15% to €3.08 billion from €3.63 billion a year ago. Net profit in the quarter was €553.1 million or €2.18 per diluted share compared to net loss of €167.2 million or €0.69 per share a year ago.


Europe Markets Review

In London FTSE 100 Index closed lower 9.96 or 0.22% to 4,425.54, in Paris CAC 40 Index decreased 17.57 or 0.54% to close at 3,231.10 and in Frankfurt DAX index lower 12.80 or 0.26% to close at 4,854.11. In Zurich trading SMI decreased 12.91 or 0.24% to close at 5,346.03.