The FTSE 100 (+0.18%) finished the day just a touch above break-even. US indices were flat to lower, as oil rebounded from earlier lows, still trading below US$130, at US$129.42. Lower oil prices were good news for airlines: BA (+1.63%), EASYJET (+6.28%) and RYANAIR (+3.59%). The main item on the earnings agenda, BRITISH ENERGY (-1.63%) saw its FY adj. EBITDA lower but ahead of market expectations due to strong realised price in 4Q. However, shares were down as the company gave no update regarding the bidding process. Investors were also looking for an update from RBS (-1.35%), which was expected to receive interest from up to seven bidders, possibly from Germany's Allianz and Switzerland's ZFS, at the first informal bid deadline for its insurance arm today. Staying with M&A, C&W (-2.76%) confirmed it made a preliminary approach to THUS's (+25.91%) board. Also, SABMILLER (-1.22%) quietly indicated to InBev that it would formally consider a bid pitched at GBP15/sh or more, according to FT Alphaville. Other earnings updates came from BURBERRY (-1.58%), which reported a 17% increase in FY revenues to GBP995.4m, in line with forecasts. SHAFTESBURY's (-4.34%) 1H adj dil NAV fell 10.5% to GBP5.78/sh, above estimates. Finally, BARCLAYS (-0.9%) updated FY consensus estimates: PTP has fallen to GBP5.876bn (vs previous GBP6.356bn), basic EPS 53.9p (vs 58.4p) and DPS 33.9p (vs 34.8p).
The CAC 40 (+1.32%) closed firmly in the black, fighting off WTI's rebound to US$129.41/bbl. Wall Street turned flat to lower as crude climbed. AIR FRANCE-KLM (-0.3%) saw downgrades from Citigroup and Merrill Lynch (both to neutral) but lost ground as the oil price rose. In aerospace news, the governments of European countries linked with EADS's (+1.43%) Airbus have offered financial support for the development of the A350 XWB, Reuters reported. Elsewhere, ARCELOR MITTAL (+2.61%) enjoyed a target hike from UBS, which kept buy. SUEZ (+1.63%) and GDF (+1.93%) have announced their respective boards will meet on 4 June to approve the merger document. Le Figaro wrote that a shareholder vote to seal the deal will take place around 14 July. Staying with utilities, British Energy fell after unveiling FY results; EDF (+2.25%) is thought to be in the running to buy the UK nuclear player. STM (+2.22%) confirmed positive guidance at its AGM yesterday. In other news, AIR LIQUIDE (+1.92%) has agreed to buy US-based Edwards Vacuum Inc's chemical management business. In wider market news, ATOS (-4.98%) has reached a deal with leading shareholders Centaurus and Pardus over the shape of the board. ADP (+3.16%) enjoyed an upgrade to neutral from JP Morgan.
With Wall Street flat-to-lower amid a rebound in oil prices and stronger-than-expected US durable goods orders, Xetra-Dax (+1.08%) closed firmly above breakeven, having once more topped the 7,000 mark. Of local note, SAP (+4.8%) won support from analysts at Cheuvreux, which double upgraded the stock today. DEUTSCHE POST (-5.42%) said it will restructure its US express business, spending up to US$2bn to turn around DHL Express, with rival UPS a partner. Royal Bank of Scotland is expected to receive interest from up to seven bidders, possibly from ALLIANZ (+1.63%) and Switzerland's ZFS, at the first informal bid deadline for its insurance arm today. Bids have been submitted for IKB (+1.08%) by Sweden's SEB as well as US financial firms Ripplewood, Lone Star and Texas Pacific, wrote Handelsblatt. JetBlue, the US budget airline partly owned by LUFTHANSA (+2.40%), is deferring delivery of 21 A320 aircraft for up to five years. Q-CELLS (-1.90%) has agreed to invest up to US$3.5bn in the mid to long term to build a production complex for thin-film modules in Mexicali, the state capital of Baja California near the US border. PRAKTIKER (+7.50%) was well bid on renewed talk of Home Depot showing an interest in the German DIY stores operator. Earnings-wise, SUEDZUCKER (+0.36%) reported 2007/08 profit after minorities of EUR 20m.
Milan ended Wednesday's session flat as Wall Street was trading in the red dragged down by a rebound in oil prices.
Back home, Reuters wrote that the government decree to turn ALITALIA's (+2.25%) bridge loan into a net asset was delayed. The airline also confirmed a FY07 loss of EUR 495m, highlighting that it needs new capital quickly to keep operating. On that note, Italy's government will allow MEDIASET's (+1.2%) Rete 4 to stay analogue until a digital switchover in 2012. On the M&A front, GENERALI (+1.38%) will not bid for RBS's insurance arm as the price of EUR 9bn asked by the British bank was considered too high, according to Il Sole 24 Ore. WestLB upgraded Generali to add from hold. In other news, FIAT (+1.51%) could decide in six months when and where it will start producing and selling cars under its Alfa Romeo brand in North America. The CEO of IMPREGILO's (-2.04%) Fibe units was arrested in a new probe over waste crisis in Campania. Il Sole 24 Ore reported that TELECOM ITALIA's (-1.62%) chairman Gabriele Galateri said that telco and its indirect shareholder Telefonica are 'fully independent'. In broker action, Citigroup downgraded SEAT (-2.64%) to sell. Separately, Deutsche Bank cut the target prices of several insurers: MEDIOLANUM (+0.45%), BANCA GENERALI (+0.67%), AZIMUT (+0.92%) and UNIPOL (+0.55%).
Spanish shares closed in the black, with Wall Street flat-to-lower as WTI moved higher at US$129.32/bbl. Meanwhile, April's durable goods orders beat estimates. Back home, INE data showed home sales in Spain fell 38.6% in March with mortgage lending down 41.9%. In corporate news, FERROVIAL's (-1.23%) BAA reported 1Q08 revenues of GBP506m, +8.8%, operating costs of GBP332m, +26.2%, and an operating loss of GBP51m vs GBP107m profit y/y. A local broker described the results as poor. BBVA (-0.14%) is to strengthen its presence in LatAm and intends to open 179 offices this year, 14% more than last, according to Cinco Dias. The Italian appeal court has ruled that TELEFONICA (+0.22%) must return the 3G mobile licence which it bought in 2000, according to Cinco Dias. Meanwhile, Telecom Italia's chairman has denied that there is any merger project with Telefonica. ABERTIS (+0.5%) has ruled out bidding for Towercast as it wants to concentrate on the Pennsylvania Turnpike, according to El Economista. In broker news, UNION FENOSA (+0.7%) enjoyed an upgrade to outperform from Cheuvreux.