European Markets Down; Allianz, Lagardere Fall

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

European markets declined as cautious investors stayed on the side lines. Allianz SE dropped 8% on first quarter net income of near breakeven and Lagardere SCA plunged 7% after revenues declined 2%. Air France-KLM Group declined 6.5% after it reported April traffic decline of 2.8%.

[R]8:00PM Frankfurt, Paris – European markets declined as cautious investors stayed on the side lines. Allianz SE dropped 8% on first quarter net income of near breakeven and Lagardere SCA plunged 7% after revenues declined 2%.[/R]

Stocks in Germany and in France led decline in benchmark indexes in the region. The weak U.S. retail sales data only added to the depth of the declines in the late afternoon trading.

Allianz SE dropped nearly 8% after it reported near breakeven results on the write down of assets.

Commerzbank AG plunged 11.6% to 5.16 euros and Deutsch Bank declined 5.5% to 38.62 euros and Deutsche Postbank AG dropped 8.3% or $1.40 to 15.50 euros.

QSC AG surged after it reported first quarter revenues increased 10% to 107.6 million euros and net income of 1.4 million euros compared to a loss of 4.1 million euros from a year ago quarter. The telecom and Internet provider estimated annual revenues between 420 million euros and 440 million euros and operating earnings between 68 million euros and 78 million euros.

The French publishing and media house Lagardere SCA dropped 6.7% to 22.20 euros after it reported first quarter revenues declined 2% to 1.78 billion euros. Revenues in the broadcast group declined 9.5% and in magazine publishing division fell 19.6%. The company cautioned lack of visibility in the earnings for the year and said that each 1% decline in revenue lowers operating earnings between 8 million and 10 million euros.

Accor SA dropped 4.6% after it reported a plan to cut costs by 370 million euros on weak global travel. Club Mediterranee SA dropped 8.5% for the second day in a row.

Air France-KLM Group declined 6.5% after it reported April traffic decline of 2.8% and cargo traffic fall of 6.4%. The airline group lowered the capacity by 3.4% and load factor increased to 80.5%, up 0.6% after it carried 6.2 million passengers. Cargo load factor dropped to 61.4%.

Earnings Review

Allianz SE, Europe’s biggest insurer said first quarter revenues rose 2.8% to €27.7 billion from €27.0 billion a year ago. Net income in the quarter fell 97% to €29 million or €0.04 per diluted share compared to net income of €1.15 billion or €2.48 per share a year ago.

CAC-40 Index Movers

Alcatel Lucent led the decliners in the CAC-40 index of 10.04% followed by losses in Credit Agricole SA of 8.43%, in BNP Paribas SA of 7.92%, in AXA of 7.73% and in Michelin SCA of 7.72%.

Sanofi-Aventis led gainers in the CAC-40 index with a rise of 3.36% followed by gains in Dexia SA of 1.78%, in Electricite de France SA of 1.32% in GDF Suez SA of 0.87.

DAX Index Movers

Commerzbank AG led the decliners in the DAX index of 13.08% followed by losses in Salzgitter AG of 7.76%, in Allianz SE of 6.60%, in Deutsche Post AG of 5.00%. in BMW AG of 4.89%.

Fresenius SE led gainers in the DAX index with a rise of 4.25% followed by gains in Fresenius Medical Care AG & Co. KGaA of 2.70%, in SAP AG of 1.86% and Linde AG of 0.63%.

Europe Markets Review

In London FTSE 100 Index closed lower 94.17 or 2.13% to 4,331.37, in Paris CAC 40 Index decreased 78.20 or 2.42% to close at 3,152.90 and in Frankfurt DAX index lower 126.50 or 2.61% to close at 4,727.61. In Zurich trading SMI decreased 68.66 or 1.28% to close at 5,277.37.