WTO to Rule Against Airbus; Air France Staff Cut

Mayank Mehta
04 Sep, 2009
New York City

The WTO rules against Airbus 380 subsidies provided by EU to EADS. Air France KLM plans to eliminate 1,500 staff and reduce cargo capacity by 15%. Deutsche Telekom is in talks to sell its T-Mobile UK unit. PSA Peugeot Citroen and Mitsubishi Motors are planning a joint venture to sell electric cars.

[R]7:00PM Frankfurt, Paris; 1:00 PM New York – The WTO rules against Airbus 380 subsidies provided by EU to EADS. Air France KLM plans to eliminate 1,500 staff and reduce cargo capacity by 15%. Deutsche Telekom is in talks to sell its T Mobile UK unit.[/R]

In London FTSE 100 Index closed higher 54.95 or 1.15% to 4,851.70, in Paris CAC 40 Index increased 45.25 or 1.27% to close at 3,598.76, in Frankfurt DAX index higher 83.01 or 1.57% to close at 5,384.43. In Zurich trading SMI increased 45.35 or 0.75% to close at 6,119.07.

The WTO ruled Airbus subsidies from EU government as illegal according to reports b the Wall Street Journal and Reuters. The judges in Geneva, Switzerland are expected to rule that A380 superjumbo plan received illegal subsidies from France, Spain, UK and Germany. However, the judges are expected to rule in favor of recent grants for the launch of A350.

Gainers & Losers

Air France KLM Group increased 1.5% to 10.13 after the air carrier plans to eliminate 1,500 jobs and cut cargo capacity by 15%.

Areva SA increased 2.2% to €388.10 after Reuters quoted Jiji Press and said Toshiba Corp is lining up a bid for French nuclear groups power and transmission business that could be worth over $5 billion. Separately, Les Echos said that China Investment Corp is looking to bid for the business as well.

BASF SE added 0.9% to €34.92 after the chemical company could restart a steam cracker plant at its Ludwigshafen headquarters put out of service in mid-April, German newspaper Rheinpfalz reported on Friday citing chief executive Juergen Hambrecht.

BMW AG added 3.3% to €31.15.

Clasquin SA the specializes in providing international freight management and logistics services fell 8.5% to €12.80 after it reported first half sales declined 27.6% and gross margins fell 4.9%.

Daimler AG added 3.9% to €31.48 and Dexia SA added 2.0% to €5.84.

Deutsche Telekom AG the telephone company increased 1.9% to €9.31 after Financial Times reported that the company is in talks to sell its T Mobile unit with several phone companies including Vodafone Group, France Telecom and Telefonica SA.

Electricite de Strasbourg SA the electricity distributor added 0.9% to €36.66 and Etablissements Maurel et Prom SA the explorer decreased 1.1% to €12.48.

Infineon Technologies increased 3.9% to €3.68 AG the after maker of semiconductors will replace Hannover Re in German DAX index operated by the Deutsche Boerse AG.

Kloeckner & Co SE decreased 6.7% to €16.40 after the metal distributor is looking to raise €200 million in rights offering.

PSA Peugeot Citroen S.A increased 7.4% to €20.05 after Mitsubishi Motors Corp and the company agreed to form a joint venture to supply electric cars.

Salzgitter AG increased 1.1% to €63.29 after the steelmaker was upgraded to “buy” from “sell” at Bankhaus B. Metzler seel. Sohn & Co.

SAP AG fell 0.4% to €33.75. after the software solutions provider said it holds 63.1% of voting rights of share capital in SAF AG.

Siemens AG added 0.6% to €59.56 after the electronics and electrical engineering said that it wants to achieve more than €6 billion of orders related to intelligent power grids by 2014, after receiving orders worth almost €1 billion in the current fiscal year ending September 30.

Television Francaise 1 SA added 1.3% to €10.98 after the French television network was downgraded to “sell” from “neutral” at Goldman Sachs Group Inc.

ThyssenKrupp AG the steelmaker added 0.7% to €23.16.

DAX Index Movers

Volkswagen AG led the decliners in the DAX index of 1.94% followed by losses in Henkel AG of 1.77%, in Fresenius of 0.67%, in METRO AG of 0.22%, in Thyssenkrupp AG of 0.22%.

Daimler AG led gainers in the DAX index with a rise of 5.12% followed by increase in BMW AG of 5.00%, in K+S AG of 3.92%, in Commerzbank AG of 3.84%, in Deutsche Bank AG of 3.65%.
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CAC-40 Index Movers

Carrefour SA led the decliners in the CAC-40 index of 1.18% followed by losses in Accor SA of 0.55%, in Veolia Environnement of 0.42%, in Danone SA of 0.41%, Pernod Ricard SA of 0.22%.

PSA Peugeot Citroen SA gainers in the CAC-40 index with a rise of 7.32% followed by gainers in Renault SA of 5.10%, STMicroelectronics NV of 4.66%, in Michelin SA of 3.40%, in Lafarge SA of 3.04%.