From Standard & Poor's European MarketScope
Trading was gloomy as the European indexes closed flat to lower Friday. In New York, a better-than-expected University of Michigan consumer sentiment index neutralized soft wholesale inventories data. A disappointing trading update from Intel (INTC) dented chipmakers. Crude traded above $60 per barrel, but didn't boost oil stocks.
Germany: The Xetra-Dax index ended Friday's session flat. In Frankfurt, Infineon fell on the Intel news. The FDA has extended the review period for YAZ, Schering's (SHR)(-2.87%) new oral contraceptive, with a decision expected in first quarter of 2006. In another development, Schering may have to pay €1 billion to keep the exclusive rights to market multiple sclerosis treatment Betaseron. Schering is in negotiations with Betaseron inventor and producer Chiron (CHIR), majority-owned by Swiss giant Novartis (NVS). Schering could lose its exclusive marketing rights if it doesn't strike a deal by the end of January, FTD reported.
The LSE has rejected Macquarie Bank's cash bid, valuing Deutsche Boerse's (-0.02%) rival at £1.48 billion. Siemens (SI) (+1.39%) plans to sell part of its troubled Siemens Business Services (SBS) unit to Fujitsi Siemens Computers, Sueddeutsche Zeitung reported. BMW (+0.53%) plans to invest some U.S.$40 million over five years in India at an assembly factory near Chennai in the south.
The Porsche (-1.56%) CEO didn't rule out increasing the luxury car maker's stake in VW (+0.41%). Axel Springer may make significant concessions to address concerns of the German cartel office over its plan to take over ProSiebenSat.1 (-0.5%).
United Kingdom: The FTSE 100 index closed lower on Friday amid losses from oil stocks after the placement of 185 million BP (BP) shares by the Kuwait Investment Office. KIO sold the equivalent of 0.89% of BP (-1.69%) as part of a portfolio rebalancing exercise.
Bradford & Bingley (+5.02%) jumped after saying it expects underlying pretax profit for fiscal year to be comfortably ahead of consensus, at the top of the range of analysts' forecasts. BAA (-0.69%) reported a modest recovery in November traffic. The airport group said the new Stansted runway will cost £2.70 billion, lower than the government estimate of £3.70 billion. LSE (+1.14%) moved higher as the board rejected a £5.80/share offer from Macquarie, calling it derisory.
Drinks group Britvic made its debut on the market today, with a price of £2.30. Shareholders Intercontinental (+0.57%) and Whitbread (-0.32%) are in line to pocket £117.30 million and £182 million from the IPO, respectively. Retailers rose on positive Christmas prospects. On the broker front, Morgan Stanley lifted its target on PartyGaming (+1.83%), while UBS upped its price objective on WPP (+3.97%).
France: Uncertainty hindered the CAC 40 index (-0.19%), which closed below breakeven despite a positive breadth of 21-16. Total (TOT) (-1.0%) was the main index's chief laggard as Venezuela announced it could close the oil giant's offices due to tax violations. Negative sentiment in the chip sector also weighed, with STM (STM)(-1.02%) fell with Infineon and Intel.
Meanwhile, the defense sector provided focus. EADS (+0.34%) closed higher as it delivered the first A320 of an order of 60 to Air Asia. The group's co-CEO reportedly said during a radio program that the recent Chinese deal was worth between U.S.$7 billion and U.S. $8 billion, a 25% discount to the announced figure. In addition, Les Echos wrote that Lagardere (+2.17%) contacted the French government in November as it sought to trim its 15% stake in the aerodefence group by fiscal year 2006.
In other news, Vinci (+2.69%) was the main gainer. The French treasury is recommending that the company acquire the government's stake in ASF (-0.16%). Carrefour (+1.06%) provided some respite after Klepierre (-0.78%) bought the Assago Center in Milan for €152 million. UbiSoft (+2.25%) was strong after posting a first half 2005-2006 net attributable loss of €11.30 million versus €32.9 million in the red in first half of 2004-2005, and said prospects for the second half are excellent.
Elsewhere: The AEX and Piazza Affari also closed in the red. In Amsterdam, VNU (+4.88%) was the top AEX performer as the WSJ wrote that two private equity firms were considering bids for the media group. The newspaper added that the bid could surpass VNU's market value of about US$8 billion. Royal Dutch Shell (RDS)(-1.03%) weighed heavily on the index, as investors took profits after Thursday's jump and as oil retreated, slipping back off intraday highs of US$61.30/bbl.
In Milan, Eni (-0.38%), and STM (-0.73%) were amongst the biggest point decliners. Autostrade (-0.29%) was said to be considering lifting its offer for French toll-road operator APRR. The French government is expected to announce a decision on its motorway privatization bid by Dec. 12. Prepared by Zaida Espana, Valerie Vidal, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, Julien Manrique, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online)