Michelin, L'Oreal, PPR Up; European Markets Fall

Mukesh Buch
31 Jul, 2009
New York City

Energy companies and airlines declined in European trading. Michelin gained after earnings results were better than expected. The comments from Deutsche Bank chief dragged market indexes lower. Eni SpA sales fell 24.2% and net profit fell 59.5%. Total S.A. sales fell 35% and net profit fell 54%.

[R]7:00PM Frankfurt, Germany; 2:00PM New York – Energy companies and airlines declined in European trading. Michelin gained after earnings results were better than expected. The comments from Deutsche Bank chief dragged market indexes lower. Eni SpA sales fell 24.2% and net profit fell 59.5%. Total S.A. sales fell 35% and net profit fell 54%.[/R]

Stocks in Europe were weak after mixed earnings energy explorers and airlines. Comments from Deutsche Bank chief also weakened the indexes. JCDecaux, L’Oreal, Michelin increased. Continental AG in Frankfurt plunged after lead investor failed to remove its chief executive.

Josef Ackermann commented that rising loan losses linked to consumer loans in corporations will affect banks that have been spared from the current wave of crisis.

In Paris CAC 40 Index decreased 9.22 or 0.27% to close at 3,426.27 and in Frankfurt DAX index lower 28.52 or 0.53% to close at 5,332.14.

Gainers & Losers

Air France-KLM declined 4.1% to 8.83 euros after first-half revenues fell 20.5% to €5.2 billion from €6.5 billion a year ago. Net loss in the first-half was €426 million or €1.45 per diluted share compared to net profit of €149 million or €0.51 per share a year ago.

Assicurazioni Generali SpA decreased 1.7% to 16 euros after first-half net earned premiums fell 2.2% to €31.8 billion from €32.4 billion a year ago. Net profit in the first-half fell 65.5% to €504 million or €0.37 per diluted share compared to net profit of €1.46 billion or €1.08 per share a year ago.

Commezbank AG decreased 1.2% to 5.50 euros.

Continental AG plunged 11% to 24.15 euros after the majority stock holder Schaeffler Group is expected to seek removal of its current chief executive Neumann. The investor group failed to get the majority needed to replace the CEO at the annual general meeting yesterday.

Deutsche Bank decreased 2.8% to 45.39 euros after the chief of the Germany’s largest bank worried that next wave of loan losses will involve banks that have been spared so far.

Deutsche Lufthansa AG decreased 1.3% to 9.48 euros after Air France-reported loss in the first half.

Enel SpA increased 1.7% to 3.81 euros after first-half revenues fell 3% to €28.5 billion from €29.3 billion a year ago. Net profit in the first-half rose 29% to €3.52 billion or €0.56 per diluted share compared to net profit of €2.74 billion or €0.44 per share a year ago.

Eni SpA plunged 7.7% to 16.33 euros after first-half sales fell 24.2% to €42.0 billion from €55.4 billion a year ago. Net profit in the first-half fell 59.5% to €2.74 billion or €0.76 per diluted share compared to net profit of €6.76 billion or €1.85 per share a year ago.

JCDecaux SA surged 14% to 14.40 euros after the company operating earnings plunged 70% to 49.5 million euros, but better than expected by market analysts.

L’Oreal SA gained 4.4% to 60.81 euros after second quarter sales increased 2.6% to 4.4 billion euros. Sales in the first half increased 1.4% to 8.8 billion euros and comparable sales adjusted for currency and businesses decreased 3.2%.

Michelin SCA surged 6.6% to 50.66 euros after first-half sales fell 13.4% to €7.1 billion from €8.2 billion a year ago. Net loss in the first-half was €122 million compared to net profit of €430 million a year ago.

Total S.A. decreased 2.7% to 38.91 euros after second quarter sales fell 35% to €31.4 billion from €48.2 billion a year ago. Net profit in the quarter fell 54% to €2.17 billion compared to net profit of €4.73 billion a year ago.

PPR SA soared 10% to 78.19 euros after first-half sales fell 3.6% to €9.23 billion from €9.58 billion a year ago. Net profit in the first-half fell 76% to €188.8 million or €1.49 per diluted share compared to net profit of €777.1 million or €6.16 per share a year ago.

Europe Markets Review

In London FTSE 100 Index closed lower 23.25 or 0.50% to 4,608.36, in Paris CAC 40 Index decreased 9.22 or 0.27% to close at 3,426.27 and in Frankfurt DAX index lower 28.52 or 0.53% to close at 5,332.14. In Zurich trading SMI increased 18.07 or 0.30% to close at 5,950.69.

DAX Index Movers

K+S AG led the decliners in the DAX index of 4.51% followed by losses in Deutsche Bank AG of 2.67%, in CommerzBank AG of 1.97%, in Deutsche Boerse AG of 1.91%, in Siemens AG of 1.83%.

Hannover Rue AG led gainers in the DAX index with a rise of 3.83% followed by increase in Fresenius SE of 3.57% in BASF SE of 2.52%, in Beiersdorf AG of 2.14%, in Merck KGaA of 1.69%.

CAC-40 Index Movers

Air France-KLM led the decliners in the CAC-40 index of 4.08% followed by losses in Pernod Ricard SA of 3.33%, in Credit Agricole SA of 2.96%, in TOTAL SA of 2.70%, in GDF Suez SA of 2.53%.

PPR SA gainers in the CAC-40 index with a rise of 10.05% followed by gains in Vallourec SA of 8.84%, in Michelin SCA of 6.64%, in Schneider Electric SA of 5.85%, in L’Oreal SA of 4.39%.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 40 increased, 59 declined and 3 were unchanged.

Standard Life Plc decliners in the FTSE 100 index with a loss of 4.67% followed by losses in BG Group Plc of 4.49%, in MAN Group Plc of 3.66%, in Eurasian Natural Resources Corporation Plc of 3.20%, in Old Mutual Plc of 3.03%.

British Airways Plc led gainers in the FTSE 100 index with a rise of 6.03% followed by increase in Xstrata Plc of 4.81%, in Kazakhmys Plc of 2.76%, in Rexam Plc of 2.61%, in Land Securities Grou Plc of 2.50%.