European Markets Edge Lower; Daimler Up

Mayank Mehta
21 Sep, 2009
New York City

European markets declined for the second day in a row. Resource stocks led the decline after commodities and crude oil futures fell. Areva received several bids for its transportation and distribution unit. Daimler expects profit in the second half. Parmalat and K+S declined.

[R]7:00PM Frankfurt, Paris; 1:00 PM New York – European markets declined for the second day in a row. Resource stocks led the decline after commodities and crude oil futures fell. Areva received several bids for its transportation and distribution unit. Daimler expects profit in the second half. Parmalat SpA fell after a judge rejected the case against its auditor Grant Thornton and Bank of America. K+S dropped on lowered earnings outlook by a competitor.[/R]

European stocks edged lower for the second day as stocks hover near the highs for the year. Worldwide investors have turned cautious as valuations have surged in a six-month rally that has led benchmark indexes higher between 27% and 45% in the region.

In London FTSE 100 Index closed lower 38.53 or 0.74% to 5,134.36, in Paris CAC 40 Index decreased 15.68 or 0.41% to close at 3,812.16, in Frankfurt DAX index lower 35.18 or 0.62% to close at 5,668.65. In Zurich trading SMI decreased 18.92 or 0.30% to close at 6,306.23.

Gainers & Losers

Allianz SE added 0.1% to €82.64 after the insurer CFO said payout obligations not at risk according to a report from Bild.

Areva SA decreased 0.6% to €409.40 after the nuclear reactor builder has received several non-binding offers for its power transmission and distribution unit. Company said potential buyers of the Company''s T&D unit have until the end of this week to make their preliminary bids.

Continental AG dropped 1.0% to €37.14 after the car-parts maker wants to keep its portfolio structure in the current from, new chief executive Elmar Degenhart was quoted on Saturday.

Daimler AG fell 1.3% to €32.98 after the luxury automaker is likely to turn profitable in the second half told CEO Dieter Zetsche to German radio Deutschlandfunk on Sunday.

Deutsche Lufthansa AG dropped 0.6% to €12.05 after the airline said that the company and Brussels airlines expanded their code sharing services on long-haul routes to Africa providing four additional destinations and seven new connections from Brussels.

E.ON AG fell 1.7% to €28.31 after the utility said it has filed a legal complaint in a bid to win the right to appeal a previous ruling by regional court, which revoked the city of Datteln''s approval of company''s plans to build a coal-fired power plant in western Germany.

Enel SpA declined 0.6% to €4.31 after the utility was upgraded to “outperform” from “underperform” at CA Cheuvreux.

Eni SpA declined 0.7% to €16.94 after the energy company has decided Tullow Oil PLC is too costly a takeover target, after recently studying the U.K. oil company and its African oil-development prospects, according to a report on Bloomberg that quoted a UK newspaper.

Infineon Technologies AG declined 2.6% to €3.63 after the semiconductor company said the Russian government is in talks with Germany on buying a stake in semiconductor manufacturer.

K+S AG declined 3.8% to €38.10 after Potash of Saskatchewan Inc lowered its profit outlook for the quarter and the year.

Lanxess AG the maker of butyl rubber for tires fell 1.8% to €32.40.

Luxottica Group S.p.A rose 0.9% to €18.23 after the maker of eyeglasses said the board of directors scheduled the company''s ordinary shareholders'' meeting for two days that starts on October 29. The meeting is expected to approve dividend of €0.22 per ordinary share, resulting in a total dividend payment of over €100 million.

Nexans SA fell 2.0% to €58.12 after the maker of cables and wires said last week it will shed 400 jobs in France as it restructures its business.

Parmalat SpA decreased 2.1% to €1.83 after the production and distribution of food and beverages said a U.S. federal judge in Manhattan has dismissed three Parmalat S.p.A. fraud lawsuits against Bank of America Corporation and the auditing firm Grant Thornton LLP over their roles in the company’s 2003 collapse.

SAP AG rose 0.4% to €34.30.

SolarWorld AG dropped 4.5% to €16.71 after the solar company said that it is significantly expanding its production in Germany. The production capacity for solar power modules in Freiberg in Saxony will be tripled to 450 megawatt until the end of 2010.

ThyssenKrupp AG decreased 3.5% to €24.06 after the steelmaker said is planning to reduce short-time work by almost a third in September a company spokesman told German weekly Euro am Sonntag.

Vivendi SA advanced 0.3% to €20.70 after the media company said Jean-Bernard Levy, chief executive of the company left open the possibility that the company will exercise its option to unload its 20% stake in NBC Universal the media conglomerate that is majority-owned by General Electric Corp. According to an article in New York Times that the stake sale may force the spin-off of the media division or listing in New York.

Volkswagen AG declined 2.8% to €110.00 after the carmaker could become a shareholder of Suzuki Motor Corporation before the end of the year according to the German auto industry magazine Automobilwoche. Separately, Bloomberg reported that the company may be sued in relation to its handling of Porsche SE saga.

DAX Index Movers

K+S AG led the decliners in the DAX index of 4.00% followed by losses in Volkswagen AG of 3.40%, in ThyssenKrupp AG of 3.25%, in Commerzbank AG of 2.57%, in Man SE of 2.55%.

BMW AG led gainers in the DAX index with a rise of 1.36% followed by increase in Allianz SE of 1.04%, in Sap AG of 0.70%, in Henkel AG & Co. of 0.15%, in Fresenius Medical Care AG & Co. of 0.12%.

CAC-40 Index Movers

Eads NV led the decliners in the CAC-40 index of 5.03% followed by losses in Technip of 4.01%, in Lafarge S.A. of 3.74%, in Unibail-Rodamco SA of 3.61%, ArcelorMittal of 3.57%.

Cap Gemini SA gainers in the CAC-40 index with a rise of 2.67% followed by gainers in Gdf Suez SA of 2.09%, Suez Environnement SA of 2.06%, in Sanofi-Aventis of 1.65%, in Accor SA of 1.34%.