Allianz, AXA Fall; Porsche in Qatar Talks

123jump.com Staff
15 Jun, 2009
New York City

European market indexes closed lower on weak mining, energy and financial stocks. Porsche is in talks with sovereign investment funds in the Middle East to raise as much as 2.5 billion euros. Steelmakers in Germany and Amsterdam trading lead the decliners in Europe.

[R]7:00 PM Frankfurt, Paris; 1:00 PM New York – European market indexes closed lower on weak mining, energy and financial stocks. Porsche is in talks with sovereign investment funds in the Middle East to raise as much as 2.5 billion euros. Steelmakers in Germany and Amsterdam trading lead the decliners in Europe.[/R]

The talks at Group of Eight finance ministers in Lecce, Italy discussed contingency plans to unwind government deficits and trim bank bailout plans. The focus of the meeting was still on how to sustain the economic growth and restrain the fallout from the ongoing financial crisis.

Credit markets were on the alert after the UK Debt Management Office worked with a syndicate of bankers to sell 5 billion pounds of debt and Austria proposed to sell 2 billion euro debt.

Metals prices closed lower after copper led the decline in London followed by losses in zinc and nickel. Crude oil declined 2%.

Insurers and banks fell sharply after the ECB estimated $283 billion write-down at banks in euro zone and sizable declines in portfolios of insurance companies.

Gainers & Losers

AXA SA dropped 4.2% to 13.92 euros and Allianz SE declined 3.3% to 65.65 euros. Deutsche Bank dropped 5.8% to 44.56 euros and BNP Paribas SA fell 2% to 48.80 euros.

ThyssenKrupp AG fell 4.7% to 19.09 euros, Salzgitter AG dropped 4.6% to 63.29 euros and Arcelor Mittal dropped 5% to 23.84 euros.

Daimler AG dropped 6.5% to 26 euros, Volkswagen AG fell 4.6% to 236.60 euros and Porsche Automobile SE declined 3.8% to 46.50 euros.

Porsche debt surged to 9 billion after it increased its stake in Volkswagen to 50.8% in the beginning of this year.

Porsche is in talks to sell at least 25% stake in the company to Qatari Investment Authority for 2.5 billion euros. The deal news was first reported by Bloomberg News.

Areva SA in Paris declined 4.9% to 424.03 euros after Financial Times reported the company may raise as much as 3 billion euros and sell its distribution and transmission division.

Air-France SA dropped 5% to 9.46 euros after Citigroup lowered its rating on the company on higher oil prices and falling passenger volumes.

Nexans SA plunged 7% to 39.51 euros after it proposed to raise 215 million euros in convertible bond offering.

DAX Index Movers

Daimler AG led the decliners in the DAX index of 6.56% followed by losses in Deutsche Bank AG of 5.62%, in Deutsche Boerse AG of 5.38%, in K+S AG of 5.31%, in ThyssenKrup AG of 5.13%.

Fresenius SE led gainers in the DAX index with a rise of 0.16%.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 3 increased, 98 declined and 1 were unchanged.

Lonmin Plc decliners in the FTSE 100 index with a loss of 9.78% followed by losses in Fresnillo Plc of 7.41%, in Eurasian Natural Resources Corporation PLC of 7.26%, in Vedanta Resources plc of 7.19% and in Xstrata plc of 7.11%.

Lloyds Banking Group plc led gainers in the FTSE 100 index with a rise of 2.30% followed by increase in AstraZeneca PLC of 0.80%, in Admiral Group plc of 0.77%, in Reckitt Benckiser Group Plc unchanged.

Europe Markets Review

In London FTSE 100 Index closed lower 115.94 or 2.61% to 4,326.01, in Paris CAC 40 Index decreased 106.56 or 3.20% to close at 3,219.58 and in Frankfurt DAX index declined 179.30 or 3.54% to close at 4,889.94. In Zurich trading SMI decreased 121.69 or 2.20% to close at 5,400.15.