Most European Stocks Advance, Paring Monthly Decline; Iliad, Kerry Climb
Aug. 31 (Bloomberg) -- David Buik, a market analyst at BGC Partners, discusses the outlook for equities and European Central Bank and Bank of England stimulus measures. He talks with Francine Lacqua on Bloomberg Television's "On The Move." (Source: Bloomberg)
Most European stocks advanced, paring the Stoxx 600 Europe Index’s biggest monthly drop since May, as U.S. consumer confidence and house prices increased more than forecast.
Iliad SA, the broadband Internet provider setting up France’s fourth mobile-phone network, climbed the most since 2008 after profit more than doubled. Kerry Group Plc, Ireland’s largest food company, surged 5.4 percent after raising its earnings forecast. Raiffeisen International Bank Holding AG slid 2.3 percent after net income missed analysts’ estimates.
The Stoxx 600 rose less than 0.1 percent to 251.31 at the 4:30 p.m. close in London as 11 stocks advanced for every 10 that declined. The measure has fallen 1.6 percent this month as the Federal Reserve said the pace of recovery will probably be “more modest” than forecast and data on U.S. home sales and durable-goods orders missed economists’ estimates.
“The markets have been so volatile in reacting to every snippet of bad news that a small bit of good news could take stocks far,” said Darius McDermott, managing director at Chelsea Financial Services in London. “We are worried about the U.S. but equities look cheap over the medium and long term.”
The Stoxx 600 erased a decline of as much as 1.3 percent today after the Conference Board’s index of U.S. consumer confidence and the S&P/Case-Shiller gauge of home prices in 20 American cities gained more than forecast.
‘Not Spectacular’
“The figures were not spectacular even if they came in above estimates,” said Philip Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels. “Uncertainty clearly persists. We are still in this wait-and-see mode and I would not be surprised to see the market drift lower until Friday’s payrolls data.”
A report on Sept. 3 may show hiring by U.S. companies cooled in August. Private payrolls that exclude government agencies rose by 42,000 after a 71,000 gain in July, while the unemployment rate climbed to 9.6 percent, according to the median estimate of 45 economists surveyed by Bloomberg News.
National benchmark indexes advanced in 11 of the 18 western European markets. The U.K.’s FTSE 100 rose 0.5 percent, Germany’s DAX gained 0.2 percent and France’s CAC increased 0.1 percent.
Iliad climbed 6.8 percent to 74.20 euros, the biggest jump since November 2008. The company said first-half net income rose to 171.4 million euros ($218 million) from 72 million euros a year earlier as its Alice unit contributed more to earnings.
Kerry Climbs
Kerry Group advanced 5.4 percent to 25.92 euros after raising its full-year earnings forecast following a “strong” performance so far in 2010.
Irish Life & Permanent Plc rallied 4.3 percent to 1.45 euros after the Irish lender said its first-half operating loss narrowed 80 percent to 10 million euros.
ARM Holdings Plc, the U.K. designer of semiconductors that power Apple Inc.’s iPhone, surged 8.6 percent to 366.8 pence, the highest level since 2002. Intel Corp. yesterday agreed to buy the wireless operations of Infineon Technologies AG for about $1.4 billion, gaining a foothold in the mobile-phone business it has struggled to crack for more than a decade.
Raiffeisen dropped 2.4 percent to 32.25 euros. The Austrian bank that operates in 17 former communist countries in eastern Europe said second-quarter net income rose to 71 million euros from 22 million euros a year earlier. Analysts had forecast a profit of 99 million euros, according to the median of four analysts surveyed by Bloomberg.
Bavarian Nordic, ASML
Bavarian Nordic slid 4 percent to 214 kroner, the most in two months. The Danish biopharmaceutical company cut its full- year forecast after technical issues forced it to delay increasing production of its Imvamune vaccine.
ASML Holding NV tumbled 3 percent to 19.68 euros, the lowest level since November. Europe’s biggest maker of semiconductor equipment was cut to “hold” from “buy” at Deutsche Bank AG.
Serco Group declined 2.5 percent to 582 pence after BofA Merrill Lynch downgraded the operator of London’s Docklands Light Railway to “neutral” from “buy.”
To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net
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