European Output Falls; ING, Nestle Drops

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

European markets edged higher after consumer prices in France fell and output in 16-nations euro area decreased 0.6% in June. Thomson credit default swaps will be settled after the vote in favor of the settlement. E.ON increased on better than expected adjusted earnings. Nestle drops on earning.

[R]7:00 PM Frankfurt, Paris; 1:00 PM New York – European markets edged higher after consumer prices in France decreased and output in 16-nations euro area decreased 0.6% in June. Thomson credit default swaps will be settled after the vote in favor of the settlement. E.ON increased on better than expected adjusted earnings.[/R]

European markets edged higher after utility company E.ON in Germany reported better than expected revenues and offered slightly weaker earnings for the year. Arcandor dropped as the company struggles to keep two divisions together. Continental AG chief executive and chairman resigned.

French consumer prices declined 0.8% in July and output in 16-nations euro zone declined 0.6% in June from previous month and dropped 17% from a year ago.

In London FTSE 100 Index closed higher 45.42 or 0.97% to 4,716.76, in Paris CAC 40 Index increased 51.06 or 1.48% to close at 3,507.24 and in Frankfurt DAX index higher 64.28 or 1.22% to close at 5,350.09. In Zurich trading SMI increased 12.51 or 0.21% to close at 5,962.49.

Traders representing banks and investors voted in favor of credit even that triggered the settlement of credit-default swaps of €3 billion of Thomson SA. The release on International Swaps & Derivatives Association said on its Web site.

Commerzbank AG request for the clarification from the association triggered the vote as Thomson seeks to lower its €2.8 billion debts by selling stocks and assets. The settlement of the CDS contracts will be implemented under the “Small Bank Protocol.”

Gainers & Losers

Arcandor AG dropped 14% to 30 cents after it failed find a buyer or investor that will keep its retail and travel group together. The operator of retailer Karstadt is likely to face a breakup as its largest lender JP Morgan seeks orderly sale of its travel group Thomas Cook.

Aixtron AG added 3.9% to €12.52 after the provider of deposition equipment to the semiconductor industry said first-half sales fell 20% to €102.9 million from €128.2 million a year ago. Net profit in the first-half fell 33.8% to €8.8 million or €0.10 per diluted share compared to net profit of €13.3 million or €0.15 per share a year ago.

Aurubis AG declined 3% to €24.50 after it reported nine month loss of €9 million and revenues declined 21% to €4.7 billion.

Continental AG decreased 1.0% to €23.75 an automotive industry supplier said first-half sales fell 32% to €9.06 billion from €13.3 billion a year ago. Net loss in the first-half was €457.1 million or €2.70 per diluted share compared to net profit of €361.1 million or €2.23 per share a year ago.

Separately, the company also announced the resignation of chief executive and chairman to meet the demand of the largest shareholder Schaeffler Group.

Drillisch AG declined 0.6% to €3.30 after the wireless services provider said first-half sales fell 6.6% to €162.4 million from €173.8 million a year ago. Net profit in the first-half rose 394% to €55.8 million or €1.11 per diluted share compared to net profit of €11.3 million or €0.22 per share a year ago.

E.ON increased 5.4% to €27.19 after it reported adjusted earnings before interest and taxes were €5.7 billion, below 1% from a year ago. First half sales increased by €1.3 billion to €42.5 billon. The company estimated for the full year adjusted earnings to be between 5% and 10% lower than a year ago.

ESR SA fell 4.5% to €1.69 after the engineering company said first-half net loss was €0.3 million compared to net profit of €0.7 million a year ago.

ING Groep N.V slipped 4.0% to €8.75 after the financial services company said first quarter gross premium income fell 22% to €7.3 billion from €9.4 billion a year ago. Net profit in the quarter fell 96% to €71 million or €0.3 per diluted share compared to net profit of €1.92 million or €0.94 per share a year ago.

Leoni AG jumped 0.2% to €14.99 after the manufacturer and supplier of wires, cables and wiring systems said first-half sales fell 36% to €1.02 billion from €1.59 billion a year ago. Net loss in the first-half was €88.2 million or €3.30 per diluted share compared to net profit of €45.7 million or €1.54 per share a year ago.

Nestle declined nearly 5% to CHF 42.36 after it reported first half sales decreased 1.5% and increased 2.8% on constant currency to CHF 52.27 billion. The company also lowered its outlook for the second half.

Patrizia Immobilien AG sank 0.6% to €3.02 after the real estate company said first-half sales fell 6% to €92.5 million from €98.3 million a year ago. Net loss in the first-half was €13.8 million or €0.26 per diluted share compared to net profit of €1.84 million or €0.04 per share a year ago.

Qiagen N.V dropped 0.2% to €14.12 after the supplier of tests for the human papilloma virus said second quarter revenues rose 10% to $240.2 million from $217.9 million a year ago. Net income in the quarter rose 33% to $30.9 million or 15 cents per diluted share compared to net income of $23.2 million or 11 cents per share a year ago.

DAX Index Movers

Beiersdorf AG led the decliners in the DAX index of 0.98% followed by losses in Adidas AG of 0.97%, in Deutsche Post AG of 0.49%, in SAP AG of 0.17%, in Muenchener Re AG of 0.15%.

E.ON AG led gainers in the DAX index with a rise of 3.93% followed by increase in RWE AG of 2.76%, in CommerzBank AG of 2.05% in Henkel AG of 1.90%, in Hannover Re AG of 1.85%.

CAC-40 Index Movers

Accor SA led the decliners in the CAC-40 index of 2.78% followed by losses in Dexia SA of 2.35%, in PSA Peugeot Citroen SA of 1.14%, in PPR SA of 0.90%, in Societe Generale SA of 0.58%.

Alcatel Lucent gainers in the CAC-40 index with a rise of 6.57% followed by gains in Air France-KLM of 4.40%, in GDF Suez SA of 4.28%, in Veolia Environnement of 3.50%, in Electricite de Strasbourg SA of 3.22%.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 77 increased, 25 declined and none were unchanged.

Fresnillo Plc decliners in the FTSE 100 index with a loss of 3.64% followed by losses in ICAP Plc of 3.05%, in Eurasian Natural Resources Corporation Plc of 2.93%, in TUI Travel Plc of 2.90%, in Thomas Cook Group Plc of 2.54%.

Balfour Beatty Plc led gainers in the FTSE 100 index with a rise of 8.26% followed by increase in Lloyds Banking Group Plc of 6.42%, in The Royal Bank of Scotland Group Plc of 5.42%, in BG Group Plc of 4.93%, in British Airways Plc of 4.21%.