Banco Espirito Santo SA led a gauge of euro-area lenders lower. D.E Master Blenders 1753 NV soared 29 percent this week after saying it’s in takeover talks that value the company at 7.6 billion euros ($9.7 billion). Ziggo NV jumped 13 percent after Liberty Global Inc. bought a 12.7 percent stake.
The Stoxx Europe 600 Index (SXXP) fell 0.1 percent in a four-day week before the Easter holiday, after declining the most in four months the previous week. The gauge has still advanced 5 percent this quarter and traded to its highest level since June 2008, bolstered by U.S. economic reports and monetary stimulus from central banks.
“The markets are in far better shape, despite a political fiasco in Italy and this extraordinary situation in Cyprus,” Stephen Isaacs, a strategist at Alvine Capital Management Ltd., told Mark Barton on Bloomberg Television this week. “We had one or two-day minor corrections and here we are back at an all-time highs, or very close to.”
The benchmark Standard & Poor’s 500 Index (SPX) climbed above its record closing level set in October 2007. Durable-goods orders rose in February by the most in five months while the S&P/Case- Shiller index of property values in 20 cities showed its biggest year-over-year increase since June 2006.
In Europe, German retail sales unexpectedly climbed in February, rising 0.4 percent. That followed a revised 3 percent in January and compared to the median economist forecast for a 0.6 percent decline.
National benchmark indexes still fell in 14 of the 18 western European markets. The U.K.’s FTSE 100 rose 0.3 percent, while France’s CAC 40 and Germany’s DAX (DAX) slipped 1 percent and 1.5 percent, respectively. Italy’s FTSE MIB Index dropped 4.4 percent, while Greece’s ASE Index lost 6.6 percent. The stock market in Cyprus remained closed for a second week.
Cyprus this week obtained a 10 billion-euro international bailout after the island agreed to shut down its second-largest lender and impose losses on uninsured deposits of more than 100,000 euros. The deal replaced a previous euro-area demand to impose a levy on all bank accounts.
Stocks and the euro sank earlier in the week after Reuters reported that Dutch Finance Minister Jeroen Dijsselbloem, who leads the group of 17 euro finance ministers, said the Cyprus bailout should be viewed as a template for solving banking problems in the region. Shares pared losses when Dijsselbloem later clarified his remarks, saying Cyprus is a “specific case with exceptional challenges.”
In Italy, bond yields surged after the leader of the Democratic Party, Pier Luigi Bersani, ruled out the possibility of creating a broad coalition following a failed meeting with rival politicians.
Bersani won a majority in the lower house of Italy’s parliament last month and needs additional support in the Senate to form a government.
A gauge of euro-area banks declined 2.2 percent. Mediobanca SpA (MB) fell 11 percent in Milan, while Banco Popolare SC slid 8.5 percent. Societe Generale SA retreated 6.6 percent in Paris and Banco Bilbao Vizcaya Argentaria SA sank 7.3 percent in Madrid.
Portuguese lenders also slumped as Moody’s Investor Service affirmed the country’s junk-debt rating with a negative outlook, saying the economy will likely undergo a later-than-expected contraction this year.
Espirito Santo (BES), Portugal’s biggest publicly traded bank, plunged 12 percent in Lisbon. Banco Comercial Portugues SA, the second-largest, lost 10 percent.
Kazakhmys Plc tumbled 16 percent as it cut its 2012 dividend by 60 percent to 11 cents a share and reported a full- year loss after the value of its stake in Eurasian Natural Resources Corp. dropped by more than half.
Telefonica SA slumped 8.3 percent after Spain’s biggest telephone operator sold about 975 million euros worth of treasury stock to help reduce its debt.
Master Blenders soared the most on the Stoxx 600 this week. The coffee and tea company that was spun off by Sara Lee Corp. said it’s in talks to be acquired by a group led by Joh. A. Benckiser. JAB, the investment firm run by Bart Becht, plans to pay 12.75 euros a share for the company.
Ziggo rallied 13 percent after John Malone’s Liberty Global paid about 632.5 million euros for a stake in the Dutch cable- television operator from Barclays Plc after the U.K. lender last week failed to find enough buyers in a share sale.
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