Spain Deficit of 11.4%; European Markets Up

Mayank Mehta
29 Jan, 2010
New York City

European markets indexes closed higher. Greek bonds rebounded. Spain estimated 2009 deficit of 11.4% and said it will be trimmed to 3% by 2013. Spain also increased retirement age to 67 from 65. Bulgari SpA fourth quarter revenue falls 5% to

[R]7:00 PM Frankfurt, Paris; 1:00 PM New York – European markets indexes closed higher. Greek bonds rebounded. Spain estimated 2009 deficit of 11.4% and said it will be trimmed to 3% by 2013. Spain also increased retirement age to 67 from 65. Bulgari SpA fourth quarter revenue falls 5% to €297 million. Infineon Technologies swings to profit. BMW expects 2009 pre-tax profit despite lower sales.[/R]

European markets closed higher after a choppy day of trading. Greek bonds rebounded but the prospect of wider contagion spreading to Spain, Portugal and Italy kept investors guessing.

In London FTSE 100 Index closed higher 42.78 or 0.83% to 5,188.52, in Paris CAC 40 Index increased 50.67 or 1.37% to close at 3,739.46, in Frankfurt DAX index higher 68.46 or 1.24% to close at 5,608.79. In Zurich trading SMI decreased 1.69 or 0.03% to close at 6,440.72.

Spain’s Finance Minister Elena Salgado said after a Cabinet meeting that 2009 year budget deficit will be 11.4% and that will decline to 3% in 2013, meeting the EU guidelines.

Salgado also estimated unemployment to average 19% this year and decline to 18.4% next year and 15.5% in 2013.

Separately she also said that Spain increased its retirement age to 67 from 65 to trim the shortfall in the pension contributions.

Gainers & Losers

Areva SA rose 0.16% to €336.15 after the nuclear group said full-year total revenues rose 6.4% to €14.0 billion from €13.2 billion a year ago. Revenue for the Nuclear and Renewables businesses rose 5% to €8.5 billion from €8.1 billion a year ago.

BMW AG rose 2.1% to €30.18 after the luxury carmaker said Friday it expects to report a pretax profit for 2009 despite lower revenues.

Bulgari SpA decreased 3.9% to €5.68 after the luxury jeweler said fourth quarter revenues fell 5% to €297.0 million compared to previous quarter and fell 2.7% at comparable exchange rates. Same-store sales rose 12% at comparable exchange rates over the same period of the previous year.

Etam Developpement SCA rose 5.4% to €18.45 after the women''s fashion retailer said fourth quarter sales rose 6.5% to €286.9 million and rose 4.5% on like-for-like basis and at constant exchange rates. Europe sales fell 1.5% to €200.1 million and fell 1.8% on like-for-like basis and at constant exchange rates. China sales rose 30.9% to €200.1 million and rose 31.1% on like-for-like basis and at constant exchange rates.

Eurofins Scientific SE the bio-analytical services declined 7.3% to €35.31.

Fleury Michon SA the processed food supplier increased 1.4% to €36.73.

Henkel AG & Co the maker of consumer products gained 2.9% to €37.49.

Infineon Technologies AG fell 0.7% to €3.92 after the semiconductor maker said first quarter revenues rose 27% to €941 million from €742 million a year ago. Net profit for the quarter was €66 million or €0.06 per diluted share compared to net loss of €404 million or €0.46 per share a year ago.

JCDecaux SA added 1.3% to €18.65 an outdoor advertising company fourth quarter revenues fell 7.2% to €561.6 million from €605.4 million a year ago and 4.9% on an organic basis. Street Furniture revenues fell 5.9% to €286.9 million from €304.9 million. Transport revenues fell 8.7% to €161.0 million from €176.4 million. Billboard revenues fell 8.4% to €113.7 million from €124.1 million.

Le Carbone Lorraine SA fell 1.0% to €24.88 after the producer of carbon and graphite products and their application said fourth quarter sales fell 17% to €148 million and fell 16% on like-for-like basis.

Munich RE dropped 1.6% to €108.52 after the reinsurer was downgraded to “underperform” from “neutral” at BofA Merrill Lynch Global Research.

Rue du Commerce SA the online electronics retailer increased 6.4% to €5.25.

Societe Generale SA advanced 1.9% to €42.63 after the bank was upgraded to “outperform” from “neutral” by Exane BNP Paribas.

Wirecard AG dropped 4.7% to €9.22 after the company announced that it has issued its fiscal year 2010 EBITDA guidance. For fiscal year 2010 operating earnings estimate was raised from €70 million to €75 million.

DAX Index Movers

Commerzbank AG led the decliners in the DAX index of 2.31%, followed by losses in Deutsche Boerse AG of 1.53%, in Deutsche Telekom AG of 1.42%, in Muenchener Rue AG of 1.18%, and in Henkel AG of 0.32%.

BMW AG led gainers in the DAX index with a rise of 4.24%, followed by losses in Volkswagen AG of 3.33%, in Linde AG of 3.21%, in Infineon Technologies AG of 2.43%, and in Diamler AG of 2.42%.

CAC-40 Index Movers

Veolia Environnement led the decliners in the CAC-40 index of 0.89%, followed by losses in Technip of 0.58%, in AXA of 0.37%, and in Vivendi SA of 0.05%.

Compagnie de Saint-Gobain SA gainers in the CAC-40 index with a rise of 4.42% followed by gainers in Vallourec SA of 3.48%, in Lagardere SCA of 3.44%, in EADS NV of 3.09% and in ArcelorMittal of 2.46%.