TUI, Club Med Rise; Porsche Falls

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

European markets edged higher after European leaders talks of early signs of sustained recovery. Porsche nine months sales declined 15% and issued cautionary outlook. HeidelbergCement renegotiated its debt that will pay 425 basis points above interbank rate.

[R]7:00 PM Frankfurt, Paris; 2:00 PM New York – European markets edged higher after European leaders talks of early signs of sustained recovery. Porsche nine months sales declined 15% and issued cautionary outlook. HeidelbergCement renegotiated its debt that will pay 425 basis points above interbank rate.[/R]

The wholesale inflation in Germany declined 3.6% in May from a year ago after falling 2.7% in April. The index of inflation was unchanged in the month from April when it fell 1.4% from March.

OAO Lukoil agreed to acquire 45% stake for $725 million in the Holland based refinery known as Vlissingen refinery. The stake controlled by Dow had the preemption right by the majority partner Total SA in the refinery with 55% stake. Earlier Dow had negotiated sale to Valero for its minority stake.

Gainers & Losers

Porsche Automobile Holding SE declined 1.4% to 44 euros after its nine months sales declined 15% to 4.64 billion euros on 28% fall in unit sales to 53,635. Porsche acquired 50.8% stake in the much larger automaker Volkswagen and holds option to add 20% more but tripled its net debt to 9 billion euros.

Volkswagen AG declined 3% to 224 euros on options expiry day. Porsche and VW are expected trade volatile in the next five weeks.

HeidelbergCement AG increased 1.9% to 31.69 euros after it renegotiated its debt.

HeidelbergCement AG renegotiated its debt a consortium of more than 50 lenders at a sharply higher debt cost. The company refinanced its 8.7 billion euros debt (or $12.1 billion) at 425 basis points above the prevailing euro interbank offered rate on the loans that are due at the end of the 2011.

The sharply higher interest cost is in addition to higher claims on assets than from bond holders.

TUI AG increased 8.8% to 5.61 euros after Deutsche Bank revised its earlier target of 1.90 euros to 4.40 euros but maintained its “sell” rating. The investment bank earlier in the week cited weakness in its container business and today corrected it earlier assumption of inter-company loan.

Club Mediterranee SA surged 6.7% to 10.95 euros after Benetton family acquired 2% stake in the company according to the news reports in Italy and confirmed by 123jump.com.

Europa Corp edged up 0.9% to 6.75 euros after it reported for the full-year ending in March revenues declined 12.6% to 128 million euros and net earnings increased 34.8% to 9.4 million euros. The company’s net debt to capital ratio increased to 0.42 from 0.31 at the end of March 2008.

Europe Markets Review

In London FTSE 100 Index closed higher 65.07 or 1.52% to 4,345.93, in Paris CAC 40 Index increased 27.21 or 0.85% to close at 3,221.27 and in Frankfurt DAX index higher 1.98 or 0.04% to close at 4,839.46. In Zurich trading SMI increased 44.75 or 0.83% to close at 5,421.59.

DAX Index Movers

Commerzbank AG led the decliners in the DAX index of 4.02% followed by losses in Volkswagen AG of 2.94%, in Daimler AG of 2.77%, in Deutsche Bank AG of 2.19%, in Bayerische Motoren Werke AG of 2.10%.

E.ON AG led gainers in the DAX index with a rise of 2.90%, followed by increase in Henkel AG & Co. of 2.13%, in Salzgitter AG of 2.06%, in Merck KGaA of 1.71%, in METRO AG of 1.02%.

CAC-40 Index Movers

BNP Paribas SA led the decliners in the CAC-40 index of 1.68% followed by losses in Suez Environnement SA of 1.25%, in Vivendi SA of 1.22%, in Air France-KLM of 0.64%, in Unibail-Rodamco SA 0.63%.

ArcelorMittal gainers in the CAC-40 index with a rise of 4.97% followed by gains in Veolia Environnement of 4.20%, in Alcatel Lucent of 3.47%, in Alstom SA of 3.46%, in Dexia SA of 2.90%.