From Standard & Poor's European MarketScopeLONDON
Positive sentiment swept across Europe Thursday. The US Federal Reserve left the Fed funds rate target unchanged at 5.25%, and also noted recent signs of 'firmer economic growth' and that core inflation has 'improved modestly'. Wall Street was set to open higher. Oil prices stayed strong at US$58.26/bl.
UK: The FTSE 100 index climbed at mid-session with miners and energy stocks staying strong. In company news, Miner Rio Tinto (RTP) (+1.33%) posted a 43% rise in net earnings to US$7.438 billion, but sees uncertainties in the global economy. Oil company Royal Dutch Shell's (RDS) (+2.34%) fourth quarter earnings of US$6 billion beat estimates.
BP (BP) (+1.03%) says it is to sell Coryton Refinery for US$1.4 billion to Petroplus. AstraZeneca's (AZN) (+2.92%) fiscal year profits come in line. The drug maker said it is to cut 3,00 jobs and sees growth slowing. Northern Foods (+3.45%) said Pat O'Driscoll will be stepping down as CEO.
All Bar One owner Mitchells and Butlers (+1.08%) reported a 4% rise in like-for-like sales in the 16 weeks to Jan. 20. In other news, Nasdaq has signaled that it is prepared for a prolonged battle for the LSE (-0.08%), and warned that if its hostile takeover bid failed, it could offer its technology to a rival as part of moves expected to drive down the LSE share price, the FT reported.
France:The CAC 40 index (+0.95%) traded firmly higher at mid-session. In Europe, corporate earnings took center stage. AXA (AXA) (+2.2%) posted fiscal 2006 sales of €78.775 billion, +9.9%. France Telecom (FTE) (+1.98%) posted 2006 preliminary revenues of €51.7 billion, an increase of 7.5% on an historical basis and 1.2% on a comparable basis.
Suez (SZE) (+1.94%) reported 2006 sales of €44.3 billion, +6.7%, +8.2% like-for-like. It said the GDF (+2.97%) merger remains its 'top priority'. It added that Suez shareholders will vote on GDF merger on June 21. Areva (+2.36%) reported fiscal 2006 sales of €10.863 billion, up 6.7% year-over-year.
Elsewhere, Sanofi-Aventis (SNY) (-1.19%) bucked the trend on reports that its weight loss drug Acomplia may be losing its head start to market a new type of fat-busting drug, with Merck and Pfizer developing rival products. Shell posted better-than-expected results: Total (TOT) (+1.64%) gained, bringing the CAC 40 more than 11pts up.
Deutsche Bank (DB) reported 2006 net income of €6 billion, up 70% year-over-year and better than expected: BNP Paribas (+0.99%), SocGen (+1.62%) and Credit Agricole (+0.94%) gained. Germany signed up for EADS's (+1.1%) Euro Hawk defense project. Veolia Environnement (VE) (+0.74%) looked for US$1 billion (+20% year-over-year) in Chinese sales this year, with Beijing set to spend heavily on environmental protection.
Germany: With US futures pointing to a positive start on Wall Street, the Xetra-Dax index (+0.88%) was in fine fettle at mid-session Thursday. On the corporate news front, Deutsche Bank (+0.64%) reported 2006 net income of €6 billion, up 70% year-over-year and better than expected. Fourth quarter 2006 net profit was €1.8 billion, which included a €355 million one-off tax benefit.
Henkel's (-5.67%) fourth quarter 2006 EBIT rose 7.3% year-over-year to €323 million on quarterly sales 3.7% higher at €3.2 billion. Both figures were below expectations. The consumer goods group expected 2007 organic sales growth of 3-4% and a rise in EBIT and EPS above this. The brokers rated this guidance uninspiring. Epcos (-4.47%) tabled first quarter sales of €334 million and EBIT of €17 million. Both numbers were below expectations. The electronics components maker expects this quarter's operating earnings to come in somewhat below that of the quarter just ended.
Karstadt's (+3.69%) Thomas Cook unit saw its annual net profit reach a record €170.8 million. TUI (-0.25%) expects a net loss of €800-900 million for 2006 compared to net earnings of €495 million the year before, wrote FAZ, without citing anyone from the travel and logistics group.
Earnings aside, Linde (+0.9%) has sold its 41% stake in Chile's Indura to its joint venture partner for €150 million. Solon (+2.21%) has offloaded its 13.07% stake in Solland Solar Energy, with sales proceeds of some €10 million expected.
Elsewhere: The SMI index (+0.93%) remained comfortably above 9,200, with all the Swiss blue chips trading higher ahead of the US opening bell.
All the Nordic bourses continued to trade in the black.