European Stocks Fluctuate, Head for Weekly Gain; SAP Advances

European stocks swung between gains and losses as the Stoxx Europe 600 Index headed for its biggest weekly gain since September.

SAP AG (SAP), the world’s largest maker of business-management software, climbed 2.4 percent after better-than-expected forecasts from Oracle Corp. (ORCL) and Accenture Plc. (ACN) Cie. de Saint- Gobain SA led construction stocks higher following gains made by the industry in Asia. Next Plc (NXT) declined as analysts at Societe Generale SA cut their recommendation on the shares.

The Stoxx 600 advanced 0.2 percent to 276.17 at 2:36 p.m. in London, having swung between gains and losses more than eight times. The index, which tumbled the most in eight months last week on fears that Japan’s March 11 earthquake would lead to a nuclear meltdown, has rebounded 3.2 percent this week.

“The market will be like a yo-yo around this level,” said Matthieu Giuliani, a fund manager at Palatine Asset Management in Paris, which oversees $5.6 billion. “Valuations aren’t high and that’s a support for stocks. But there isn’t anything to get overly excited about. Economic growth is weak and that will eventually weigh on earnings.”

The Stoxx 600 has fallen 5.2 percent from this year’s high on Feb. 17. That has left the gauge trading at about 13.5 times its companies’ reported earnings, near the cheapest since 2009, according to data compiled by Bloomberg.

National Indexes

National benchmark indexes rose in 11 of the 18 western European markets that were open. France’s CAC 40 added 0.1 percent, while the U.K.’s FTSE rose 0.4 percent. Germany’s DAX climbed 0.2 percent.

European Union leaders are concluding a two-day meeting on the region’s fiscal crisis in Brussels today. Portugal continued to rule out a rescue after the parliament’s rejection of budget cuts led Prime Minister Jose Socrates to offer to quit. A bailout may total as much as 70 billion euros ($99 billion), two European officials with direct knowledge of the matter said, as credit-rating cuts threatened to deepen Portugal’s debt woes.

LCH.Clearnet Ltd., Europe’s biggest clearinghouse, said Portuguese government bonds will no longer be eligible for delivery in any of its RepoClear euro general collateral baskets after the nation’s debt was downgraded by S&P.

SAP gained 2.4 percent to 43.16 euros after Accenture, the world’s second-largest technology-consulting company, gave a sales forecast for this quarter that exceeded analysts’ estimates and Oracle forecast fourth-quarter profit that topped analysts’ predictions.

Construction Stocks

Construction stocks climbed, following gains in Asia, amid optimism that demand would increase as Japan rebuilds. Saint- Gobain, Europe’s biggest provider of building materials, increased 1.7 percent to 43.69 euros. Holcim Ltd. (HOLN), the second- largest cement maker, climbed 1.3 percent to 69.1 francs.

Next, the owner of more than 500 fashion stores in the U.K. and Ireland, slipped 1.2 percent to 2,018 pence. The stock was cut to “hold” at Societe Generale.

Derwent London, a real estate company, dropped 1.1 percent to 1,663 pence. BofA Merrill Lynch Global Research cut the stock to “underperform” from “buy.”

Reckitt Benckiser Group Plc (RB/) increased 3.3 percent to 3,164 pence. The maker of Nurofen painkillers was raised to “buy” from “neutral” at BofA Merrill Lynch Global Research.

HMV Group Plc (HMV) surged 7.5 percent to 18 pence as Sky News reported that the company has been approached by, among others, Hilco U.K. Ltd., a specialist in distressed retailers. HMV said that, while it’s looking at options for its Waterstone’s bookstores and Canadian outlets, there have been no talks.

Credit Agricole

Credit Agricole SA (ACA) rallied 2.6 percent to 12.25 euros after Exane BNP Paribas initiated coverage of France’s third-largest lender with an “outperform” recommendation.

Eurazeo (RF) jumped 3.8 percent to 55.07 euros. France’s largest publicly traded private-equity firm said 2010 net income was 115 million euros, reversing a restated 200.9 million-euro loss in the year earlier. The company said it a proposing a dividend for the year of 1.20 euros a share.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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