European Markets Rally; Gobain, Parmalat Shine

Mayank Mehta
26 Feb, 2010
New York City

European markets rallied on the expectations that Germany is closer to providing details of financial assistance to Greece. Bayer AG net for the year dropped 21%. Parmalat SpA 2009 net declined 23% on sales decline of 1.5%. Telefonica SA fourth quarter net surged 22% on Latin American businesses.

[R]7:00 PM Frankfurt, Paris; 1:00 PM New York – European markets rallied on the expectations that Germany is closer to providing details of financial assistance to Greece. Bayer AG net for the year dropped 21%. Parmalat SpA 2009 net declined 23% on sales decline of 1.5%. Telefonica SA fourth quarter net surged 22% on Latin American businesses. Volkswagen 2009 sales increased 1.1% and net dropped 80% from a year ago.[/R]

European markets closed higher after Germany prepared to extend loans to Greece through state controlled KfW.

In addition, Luxembourg Finance Minister Luc Frieden was quoted in Hadelsblatt newspaper that euro zone nations have no alternative but to extend financial aid to troubled nations.

Annual inflation in the euro area rose 1% in January compared to a gain of 0.9% in December. Monthly inflation fell to 0.8% in January. Compared to year ago annual inflation of fell 1.7%.

In London FTSE 100 Index closed higher 76.30 or 1.45% to 5,354.52, in Paris CAC 40 Index increased 68.03 or 1.87% to close at 3,708.80, in Frankfurt DAX index higher 66.13 or 1.20% to close at 5,598.46. In Zurich trading SMI increased 67.03 or 1.01% to close at 6,710.99.

Gainers & Losers

Air Liquide SA rose 3.6% to €86.11 after the producer of industrial gases was upgraded to “buy” from “underperform” at Bank of America Merrill Lynch Global Research.

Bayer AG fell 3.3% to €47.74 after the pharmaceutical and medical products company said 2009 revenues fell 5% to €31.2 billion from €32.9 billion a year ago. Net profit for the year fell 21% to €1.36 billion or €1.70 per diluted share compared to net profit of €1.72 billion or €2.22 per share a year ago.

Compagnie de Saint-Gobain SA added 6.2% to €34.00 after the building materials supplier said 2009 revenues fell 13.7% to €37.8 billion from €43.8 billion a year ago. Net profit for the year fell 85.3% to €202 million or €0.39 per diluted share compared to net profit of €1.38 billion or €3.60 per share a year ago.

COLT Telecom Group S.A fell 3.8% to €131.80 after the provider of business communications said 2009 revenues fell 3.2% to €1.62 billion from €1.68 billion a year ago. Net profit for the year rose 69% to €121.6 million or €0.14 per diluted share compared to net profit of €71.9 million or €0.11 per share a year ago.

Daimler AG the luxury automaker rose 1.1% to €30.68.

Eiffage SA fell 2.4% to €34.35 after the construction and concessions group said 2009 revenues were flat at €13.2 billion. Net profit for the 2009 fell 35% to €190 million compared to net profit of €293 million a year ago.

Indra Sistemas SA the information technology solutions and consultancy services provider said 2009 revenues rose 5.5% to €2.51 billion from €2.38 billion a year ago. Net profit for the year rose 7% to €195.6 million compared to net profit of €182.4 million a year ago.

IKB Deutsche Industriebank AG fell 1.2% to €0.80 after the bank said nine months net interest income fell 51.4% to €149.9 million from €308.2 million a year ago. Net loss for the nine months was €593.8 million compared to net loss of €11.4 million a year ago.

Parmalat SpA rose 3.3% to €1.85 after the producer and distributor of food and beverages said 2009 revenues rose 1.5% to €4.0 billion from €3.94 billion a year ago. Net profit for the year fell 23% to €521.5 million or €0.30 per diluted share compared to net profit of €675.7 million or €0.40 per share a year ago.

Saras SpA dropped 4.2% to €1.73 an oil refiner said 2009 revenues fell 38.6 % to €5.32 billion from €8.67 billion a year ago. Net profit for the year rose 17.5% to €72.6 million or €7.82 per diluted share compared to net profit of €61.8 million or €6.56 per share a year ago.

Telefonica, S.A the telecommunication company said 2009 revenues fell 2% to €56.7 billion from €57.9 billion a year ago. Net profit for the year rose 2.6% to €7.8 billion compared to net profit of €7.6 billion a year ago.

Volkswagen AG declined 0.8% to €63.53 after it reported 2009 sales increased 1.1% and net declined to €960 million or €2.44 per share compared to €4.75 billion or €11.98 a share.

DAX Index Movers

BayerAG led the decliners in the DAX index of 1.80%, followed by losses in Volkswagen AG of 1.48%, in Deutsche Telekom AG of 0.19%.

Henkel AG led gainers in the DAX index with a rise of 4.49%, followed by increase in Allianz SE of 2.77%, in Deutsche Post AG of 2.27%, in Beiersdorf AG of 2.05%, and in Linde AG of 2.01%.

CAC-40 Index Movers

Pernod Ricard SA led the decliners in the CAC-40 index of 0.31%, followed by losses in Unibail-Rodamco SA of 0.14%.

Compagnie de Saint-Gobain SA gainers in the CAC-40 index with a rise of 7.88%. followed by increase in Air Liquide SA of 5.61%, in EADS NV of 4.30%, in Credit Agricole SA .of 4.00% and in LVMH Moet Hennessy Louis Vuitton SA of 3.70%.