ADVFN Morning Euro Markets Bulletin - February 8th 2011

By ADVFN.com
ADVFN offer FREE streaming stocks and shares data form around the world. SEE

London Market Reports
Slow start for Footsie

Market Movers
FTSE 100 6,039.96 -0.18%
techMARK 1,927.49 -0.22%
FTSE 250 11,789.51 -0.18%

As expected, London has made a slow start, with the leading index giving back a handful of points after closing at its highest in almost three weeks last night.

In company news, BG Group grew fourth quarter profits by 3% thanks to higher energy prices and a lower exploration charge. Operating profit rose to $1.80bn in the last three months of 2010 from $1.76bn the year before.

Mining giant Xstrata enjoyed a sharp surge in profitability in 2010, as the benefits of 2009’s restructuring activities kicked in and production volumes soared. Profit before tax rose to $7.11bn, excluding exceptional items, from $1.87bn.

The drilling results at Premier Oil’s Catcher North Well in the UK Central North Sea have indicated an oil pay at the lower end of the company’s expectations. Premier now estimates the overall oil reserves range for the combined Catcher, Catcher North and Catcher East discoveries at between 40 and 80mmbbls.

Chancellor George Osborne has increased the government levy on bank profits this year by £800m to £2.5bn. Originally the chancellor said he would phase the tax in, with a lower rate of £1.7bn applicable in 2011 rising to about £2.5bn annually by 2012-13. Lloyds is higher, but the rest of the banks have wavered a little.

The political turmoil in Egypt and Tunisia will knock £20m from Thomas Cook's profits this quarter, the travel group warned, disrupting what had been a good start to the year. Revenue in the first quarter rose by 7% to £1.81bn reflecting increased volumes and improved product mix, while the traditional seasonal loss fell to £37.3m.

Broadband telephony group TalkTalk is to axe 580 jobs as part of a £25m cost cutting drive after sales and subscriber numbers fell in the third quarter. The cuts are part of a plan to integrate all the firm's technology and IT capabilities and eliminating functional duplication.

Specialist insurer and reinsurer Beazley pumped up profit by 59% in 2010 and is in the mood for acquisitions. Profit before tax swelled to $250.8m from $158.1m in 2009, though this year’s number was boosted by a one-off foreign exchange gain of $33.7m.

McBride, maker of own label products for retailers, met forecasts with a 29.6% drop in first half profit as it battles with rising raw materials prices and a difficult retail environment, particularly in the UK. The group, which supplies supermarkets such as France's Carrefour and Tesco, said revenue for the six months ended 31 December 2010 fell 1% at £407.9m from £412.4m a year earlier. Pre-tax profit fell to £15.5m from £22.5m.


--------------------------------------------------------------------------------

Traders can turn £3k into £150k – Learn how
Earn a tax free income trading, from just 20 minutes a day – no experience needed
Our powerful trading software will help you decide when to enter trades and how to maximise profits.

Register for a FREE brochure and trading guide, Click Here.




--------------------------------------------------------------------------------

UK Event Calendar
INTERIMS
Mcbride

QUARTERLY EX-DIVIDEND DATE
IBM Corp.

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Bankruptcies (JPN)
Bank of France Business Sentiment (FRA) (07:30)
Trade Balance (FRA) (07:45)
Industrial Production (GER) (11:00)
NFIB Small Business Optimism (US) (12:30)

Q4
BG Group, Wolfson Microelectronics

GMS
Melrose Resources

FINALS
Beazley, Low & Bonar, Patsystems, Wolfson Microelectronics, Xstrata

IMSS
Mcbride, Thomas Cook Group

AGMS
Renovo Group, Victrex

UK ECONOMIC ANNOUNCEMENTS
BRC Retail Sales Monitor (00:01)
RICS House Price Balance (00:01)


--------------------------------------------------------------------------------

Sippdeal
The UK's first online SIPP and a tax efficient, low-cost, award winning way to manage your pension fund. With online dealing fixed at £9.95, no establishment charge, no SIPP annual administration charge, no contribution charge and free transfers in – Sippdeal could be ideal for you. Click here


--------------------------------------------------------------------------------

European Market Reports
ArcelorMittal shines in mixed markets

European shares open mixed, with Italy lower, Germany higher and France more or less unchanged.

The MIB in Milan is down 97 at 22,695 while the DAX in Germany is up 5 points at 7,289.

In Switzerland, banking giant UBS has reported a 7% jump in fourth quarter profit to SFr.1.29bn from SFr.1.21bn a year earlier.

The wealth management side saw net inflow of funds for the second quarter in successions, with a net increase of SFr. 6.1bn.

The investment banking arm saw pre-tax profit fall by three-quarters to SFr. 75m from a year earlier after it took a SFr. 509m charge related to the bank’s own debt.

UBS said it pared the total 2010 bonus pool by one-tenth to SFr.4.3bn.

Results from Swiss fragrance maker Givaudan were in line with expectations, with the company seeing a 71% increase in full-year post-tax profit.

The company had a grumble about rising commodity prices but is looking to pass some or all of the effects of these on to its customers.

Luxembourg-based steel giant ArcelorMittal is the top performing blue-chip in Paris despite posting a net loss of $780m in the final quarter of 2010, compared to a profit of $1.1bn a year earlier.

Sales rose to $20.7bn from $17.43bn a year earlier.

The market was encouraged by the company’s bullish outlook. "Overall, we expect 2011 to be better than 2010," the company said.

The company’s guidance range for earnings before interest, tax, depreciation and amortisation in the first quarter is $2bn to $2.5bn.

In Germany, car making titan Volkswagen has concluded a wage deal with its German workforce. The company will lift wages of its 100,000 strong Germany workforce by 3.2% from the beginning of May in a deal that runs until 31 May 2012. The workers will also receive a one-off bonus equivalent to 1% of their annual salary.

On the economic front, French business confidence rose to its highest level in more than three years in January.

The Bank of France Business Sentiment Indicator for manufacturers climbed to 110 from a revised 107 in December, topping economists’ expectations of a January reading of 108.

CAC 40 - Risers
ArcelorMittal SA (MT) € 28.16 +3.34%
Peugeot (UG) € 30.81 +2.96%
Renault (RNO) € 48.89 +1.94%
Schneider Electric (SU) € 112.15 +0.85%
Cap Gemini (CAP) € 39.94 +0.83%
Publicis Groupe Sa (PUB) € 38.67 +0.82%
PPR (PP) € 115.55 +0.61%
Accor (AC) € 34.10 +0.32%
Vallourec (VK) € 80.88 +0.21%
AXA (CS) € 15.90 +0.16%

CAC 40 - Fallers
Vivendi (VIV) € 21.21 -2.15%
Carrefour (CA) € 35.04 -1.34%
Technip (TEC) € 73.01 -1.28%
ST Microelectronics (STM) € 9.14 -1.13%
Credit Agricole (ACA) € 11.32 -1.09%
Alstom (ALO) € 42.23 -1.02%
Pernod Ricard (RI) € 69.86 -0.94%
Veolia Environnement (VIE) € 23.26 -0.87%
France Telecom (FTE) € 16.39 -0.85%
BNP Paribas (BNP) € 55.86 -0.82%


--------------------------------------------------------------------------------

Open a Selftrade Dealing account
...and pay a flat £12.50 per online trade. Deal in UK and international equities, funds, bonds, covered warrants and listed CFDs. Instant account funding via debit card. No dealing fee on fund purchases. Annual Management Fee of £35 + VAT with 3 free trades. Click Here


--------------------------------------------------------------------------------

US Market Reports
Huge deals lift Wall Street

A burst of big takeover deals helped Wall Street make goods gains in what some dubbed 'merger Monday'.

Dow Jones closed up 69 at 12,161. Nasdaq added 14 at 2,783, while the S&P 500 added 8 at 1,319. Sentiment was also boosted by an easing of tensions in Egypt, where bonds have rallied, indicating increased investor confidence in the country.

Web services group AOL kicked off the feverish M&A activity by paying $315m for liberal-leaning online news website The Huffington Post (THP) as it looks to turn around declining revenues and traffic.

“The acquisition of THP will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers," said AOL chairman and chief executive officer Tim Armstrong.

Drilling rigs company Ensco is buying Houston-based rival Pride International for $7.3bn in cash and shares. The deal will create the second-largest offshore drilling business in the world. Shares in Pride surged ahead.

Meanwhile, medical device maker Danaher Corp has coughed up $6.8bn for diagnostic research equipment group Beckman Coulter, sending the latter’s shares soaring.

Hasbro's fourth-quarter earnings fell to 99c per share from $1.09 a year ago, but the market was in a forgiving mood and the shares picked up.

S&P 500 - Risers
Big Lots Inc. (BIG) $39.20 +15.46%
J.C. Penney Co. Inc. (JCP) $33.39 +5.70%
American International Group Inc. (AIG) $42.18 +5.45%
St Jude Medical Inc. (STJ) $44.00 +4.86%

S&P 500 - Fallers
Sysco Corp. (SYY) $28.01 -6.16%
Nvidia Corp. (NVDA) $24.86 -3.15%
Tyson Foods Inc. (TSN) $17.99 -3.07%
Humana Inc. (HUM) $58.74 -2.97%

Dow Jones I.A - Risers
Bank of America Corp. (BAC) $14.67 +2.66%
American Express Co. (AXP) $44.82 +2.28%
JP Morgan Chase & Co. (JPM) $45.50 +2.04%
Microsoft Corp. (MSFT) $28.20 +1.55%

Dow Jones I.A - Fallers
Pfizer Inc. (PFE) $19.04 -1.35%
Kraft Foods Inc. (KFT) $30.87 -1.03%
McDonald's Corp. (MCD) $73.45 -0.81%
Verizon Communications Inc. (VZ) $36.02 -0.80%


--------------------------------------------------------------------------------

Maximise your Profit from investing in three sectors at the same time..
Reality TV, Live Internet Programming and Content Delivery Technology

Realising that the Internet still allows massive profits to be made from relatively small investments, on an ever decreasing time scale, TXI International is offering individual investors the chance to participate in its pre-IPO fund raising campaign. Click Here for further details


--------------------------------------------------------------------------------

Newspaper Round-up
Bank lending, Chaucer, BSkyB...

UK banks will provide over £1bn in equity funding to small companies to help boost regional growth, as part of an imminent deal intended to end months of verbal sparring between Westminster and the City. Negotiations to finalise the agreement continued into Monday night.

Several senior bankers said no equity commitment had yet been agreed. However, Nick Clegg, deputy prime minister, is confident banks will provide £1.3bn over three years to invest in enterprises in parts of Britain most affected by the public spending cuts, the FT reports.

Guy Hands bounced back to dealmaking yesterday with a £300m bid for Chaucer, the Lloyd’s of London insurer. Mr Hands, who was humbled last week when his private equity firm Terra Firma lost control of EMI to its lenders, is understood to be targeting three further buyouts in Europe as part of his fightback. Insiders said that Mr Hands, who sank 30% of two Terra Firma funds into the disastrous £4.2bn buyout of EMI in 2007, is confident that he can drag his under-water Terra Firma Capital Partners III (TFCP III) fund back to break-even, the Times reports.

The Competition Commission has reported that British Sky Broadcasting is making “excess profits” on its Sky Movies service, prompting analysts to say that the broadcaster will be forced to cut its margins. BSkyB’s exclusive deal with the six big Hollywood studios will come under scrutiny, as will the wholesale price that the company charges other broadcasters to show its 10 film channels, experts said, the FT reports.

British pension funds are betting more heavily on shares than any of their overseas peers, according to a study that reveals that Britain is still the world’s third-biggest pension-saving country. Yet British funds have reduced their exposure to equities from 74% to 55% over the past decade, according to research by the actuaries Towers Watson, the Times reports.

Hedge funds have been piling into the oil market, betting that the price of crude will rise on fears that turmoil in Egypt could affect production and trade through the Suez Canal. The number of long positions taken by speculators in the oil market has jumped 18pc over the past eight weeks. In London, Brent crude tipped back over $100.40 a barrel on the Intercontinental Exchange, putting on 57c, the Telegraph reports.

Timothy Geithner, the US Treasury Secretary, has voiced tacit support for Brazil in its "currency war" with China in a sign that the two giants of the Americas will work together to tackle the issue. Speaking during his first official visit to South America's biggest country, Mr Geithner said "under-valued currencies" elsewhere meant Brazil has received a disproportionate share of global capital inflows, the Telegraph reports.

More than 20 years after Barlow Clowes went bust, taxpayers appear to have been repaid the £153m which was distributed as ex-gratia compensation to more than 14,000 investors. Mark Hoban, Financial Secretary to the Treasury, announced that a total of £156.5m has now been recovered from the liquidation of a complex web of offshore companies, the Telegraph reports.

The barriers to mergers between water companies could be lifted if regional monopolies agreed to introducing competition, the industry regulator has told the Financial Times. As water companies brace themselves for one of the biggest shake-ups since privatisation in 1989, Regina Finn, chief executive of Ofwat, has hinted at the regulator’s initial proposals to revamp the rules, due to be released in the spring.

A financier found guilty of market abuse had his fine of £281,000 almost halved yesterday after the Financial Services Authority decided that he had been motivated by “wishful thinking” rather than deliberate deceit. David Massey borrowed then sold 2.5m shares in Eicom at 8p each on November 1, 2007. According to the FSA, Massey’s ad hoc role as a public relations consultant to Eicom made him privy to the planned share issue, but that information was not readily available to the public, the Times reports.

Retailers posted their biggest rise in underlying sales for 10 months in January, suggesting that gloomy forecasts of a dire first quarter may be wide of the mark. But high street chains warned that they received a boost from pent-up demand after the heavy snowfall in December, a surge in spending ahead of the VAT increase and continued heavy discounting, the Independent reports.