European Stocks, U.S. Futures Are Little Changed
Aug. 3 (Bloomberg) -- Michael Tyndall, an automotive specialist at Nomura International Plc, talks about Bayerische Motoren Werke AG's second-quarter profit and outlook. The world’s largest manufacturer of luxury cars reported the biggest profit in 2 1/2 years after demand for the new 5 Series surged and sales advanced in China and the U.S. Tyndall speaks from London with Maryam Nemazee on Bloomberg Television's "Countdown." (Source: Bloomberg)
Aug. 3 (Bloomberg) -- Lawrence Rosen, chief financial officer at Deutsche Post AG, talks about second-quarter earnings at Europe's biggest mail carrier and the decision to raise it's forecast for 2010. He speaks with Linzie Janis on Bloomberg Television's "Start Up." (Source: Bloomberg)
July 27 (Bloomberg) -- Jonathan Stubbs, head of European and U.K. equity strategy at Citigroup Inc., talks with Bloomberg's Haslinda Amin about the results of the stress tests for European banks and his investment strategy. Stubbs, speaking in Hong Kong, also discusses the outlook for the global economy. (Source: Bloomberg)
European stocks were little changed, with the Stoxx Europe 600 Index closing near a three-month high, as better-than-estimated results at Bayerische Motoren Werke AG offset concern about the strength of the U.S. recovery.
BMW climbed 3.1 percent after reporting the biggest profit in 2 1/2 years. Deutsche Post AG rose to the highest level since Jan. 14 after raising its forecast. ITV Plc dropped 3.6 percent, leading a selloff in media stocks, as the U.K.’s biggest commercial broadcaster said the outlook is “uncertain.” Sky Deutschland AG sank 26 percent after the company announced a capital raising and predicted a full-year loss.
The benchmark Stoxx 600 was little changed at 262.06 at the 4:30 p.m. close in London, after yesterday surging 2.6 percent. The gauge rose 4.9 percent in July, its first monthly gain since March, as companies reported results that topped analysts’ estimates and concern eased about the region’s sovereign-debt crisis. About 56 percent of companies in the Stoxx 600 to have reported since July 12 have beaten forecasts for net income, according to data compiled by Bloomberg.
“The month of July was encouraging for equity investors. Nonetheless, it is clear that investor confidence has hardly improved,” said Paris-based Christopher Potts, a strategist at CA Cheuvreux, in a report to clients dated yesterday. “The essential problem in the equity world is the lack of confidence in the recovery of the U.S. economy.”
Lost Momentum
Stocks fell earlier after U.S. data consumer spending, pending home sales and factory orders were all weaker than projected in June, showing the U.S. recovery lost momentum heading into the second half of the year as employment stagnates.
National benchmark indexes rose in 10 of the 18 western European markets that were open today. Germany’s DAX rose 0.3 percent, the U.K.’s FTSE 100 closed little changed and France’s CAC 40 declined 0.1 percent.
Bayerische Motoren Werke AG led carmakers higher, climbing gained 3.1 percent to 43.16 euros after the world’s biggest manufacturer of luxury cars reported a surge in profit, boosted by demand for the new 5-Series and an increase in sales in China and the U.S.
Net income attributable to shareholders gained more than sixfold to 831 million euros ($1.1 billion) from 119 million euros a year earlier. That beat the 546 million-euro average estimate in a Bloomberg survey. Revenue rose 18 percent.
Raised Forecast
Deutsche Post rallied 3.7 percent to 14 euros after Europe’s biggest mail carrier raised its earnings forecast for 2010 as second-quarter profit jumped 23 percent to 81 million euros, compared with the average analyst estimate of 83.8 million euros.
Taylor Wimpey Plc climbed 9.1 percent to 31.1 pence after the U.K.’s second-largest homebuilder by volume swung to a profit in the first half after the company cut costs and an earlier charge wasn’t repeated.
Shire Plc gained 1.3 percent to 1,473 pence as the Dublin- based drugmaker offered to buy Belgium’s Movetis NV, which develops drugs for gastro-intestinal diseases, for 428 million euros in cash.
Shire offered 19 euros a share and said in a statement that the acquisition will boost earnings after 2012. Movetis said it supports the Shire offer.
SBM Offshore NV rose 3.1 percent to 13 euros after Credit Suisse Group AG upgraded the world’s biggest producer of floating oil-production platforms to “outperform” from “underperform.”
Tougher Comparatives
ITV fell 3.6 percent to 51.6 pence after the broadcaster reported first-half revenue of 987 million pounds ($1.57 billion) compared with an average analyst estimate of 988 million pounds. The company said the outlook for advertising in the fourth quarter and into 2011 was “uncertain” as “comparatives become much tougher.”
Sky Deutschland AG plunged 26 percent to 1.05 euros after the company, which is 45.4 percent-owned by Rupert Murdoch’s News Corp., said it will raise at least 340 million euros ($450 million) for investment after posting a loss in the second quarter.
The German company said it will post a loss before interest, taxes, depreciation and amortization in 2010 following a loss of 262.7 million euros in 2009 because of “slower-than- expected subscriber development.”
Drop in Profit
UniCredit SpA dropped 1.8 percent to 2.18 euros after Italy’s largest lender reported a drop in second-quarter profit to 148 million euros from 490 million euros a year earlier. That compared with the median analyst estimate of 225 million-euro, according to a Bloomberg News survey.
Royal DSM NV lost 2.3 percent to 36.87 euros after the world’s largest maker of vitamins forecast second-half earnings growth will slow.
Earnings before interest and taxes in the six months through December will probably be less than the 470 million euros posted for the first half, Chief Financial Officer Rolf- Dieter Schwalb said today on a conference call.
Investec Plc, the South African private bank and wealth manager, dropped 5.6 percent to 475.2 pence, the second-biggest decline on the Stoxx 600, after the company sold 22 million new shares to “take advantage of opportunities in credit and other markets.”
BofA-Merrill Lynch placed the shares, which represented more than 4 percent of its existing stock, at 475 pence apiece, raising 104.5 million pounds.
To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.
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