Europe, Asia Mixed

European and Asian stock markets were mixed on Tuesday on a stronger U.S. dollar and lower oil prices

European stock markets were mixed on Tuesday. In London, the Financial Times Stock Exchange closed slightly higher gaining 15.70 points, or 0.32%, to close at 4995.50, as attention focused on BP's fourth-quarter results and hotel stocks rose. The oil giant reported a 26% rise in fourth-quarter proforma net profit to $3.646 billion, vs. $2.887 billion, ahead of expectations, and said the result includes net exceptional and non-operating charges of $1.127 billion. BP will continue to buy back shares and raised its fourth-quarter dividend by 26% to $0.085. Hilton was among the top performers after a broker upped its target price. Intercontinental Hotels also gained 2.05%. Marconi said its third-quarter losses narrowed to 21 million pounds, vs. 66 million pounds year-over-year and 29 million pounds quarter-over-quarter and expects further growth in 2005. Dixons dropped 0.76% following BRC data showing a significant weakening of electrical sales in the last three weeks of January. British Airways benefitted 1.66% from a broker raising its target price and news that the Australian regulator approved the continuation of its agreement with Qantas. ITV gained 2.52% on Ofcom's PSB announcement.

In Frankfurt, the DAX gained 5.04 points, or 0.12%, to close at 4371.39. Germany's DAX fell marginally after continuing to test its highest levels since the summer of 2002. Performances were mixed and sentiment was still positive, after Wall Street gained on a stronger U.S. dollar and softening oil prices. Frankfurt volumes were thin, with much of Germany closed again due to the end of carnival. As predicted German industrial production rebounded by 1.2% month-over-month in December, above forecasts. On the corporate front, Infineon was the star performer on hopes the patent lawsuit brought by Rambus may be dismissed after the judge demanded certain documents from the plaintiff. The stock also gained on tech optimism ahead of the Cisco report. Deutsche Boerse rose 1.83% after rumours circulated its rival for LSE, Euronext, was on the verge of submitting a formal bid. Tui benefited from a Morgan Stanley upgrade to its price target and a higher travel sector thanks to the oil prices. Deutsche Telekom's T-Mobile unit said it would cut 795 jobs in the UK. Altana and Henkel dipped after recent strength. Adidas' boss Herbert Hainer told journalists he was expectant of meeting, if not beating, 2005 profit targets.

France's CAC-40 lost 1.13 points, or 0.03%, to close at 3980.77. Wall Street moved marginally higher in early trading, supported by softening oil prices and slowing economic and corporate newsflow. Investors awaited results from Cisco. Back at home, a handful of stocks made significant moves. STM leapt 3.2% ahead of Cisco's results this evening. Renault rallied on consensus-topping fiscal 2004 results, although the carmaker predicted that rising commodity prices could erode its fiscal 2005 operating margin to just over 4%, vs. more than 5% in 2004. Business Objects surged 11.4% after fourth-quarter results and first-quarter guidance exceeded expectations. UBS upped its target on the stock to 23 euro and reiterated buy. Consumer Staples remained weak: Carrefour plans to withdraw from Mexico because of tough competition. Danone dipped 1.5% ahead of fiscal 2004 results due on Friday. On the broker front, JP Morgan upgrades Sanofi to neutral. UBS lifted Lafarge's target to 95 euro from 86 euro. Citigroup upgraded Vinci to buy from hold, raising the target to 130 euro from 100 euro. Morgan Stanley started coverage of Gemplus and Oberthur with an underweight rating.

Asian markets were mixed on Tuesday. Tokyo's Nikkei 225 shares edged lower on Tuesday after a one-month closing high. The benchmark index lost 9.43 points, or 0.08%, to close at 11,490.43. But exporters were supported by a stronger U.S. dollar and lower oil prices. Toyota Motor and Honda Motor jumped 0.25% and 0.9%, respectively. The hot stock for the morning was Nippon Broadcasting System, which spiked 8.35% after internet firm Livedoor Co added a 29.6% stake in the radio broadcaster. On the downside, drug maker Eisai Co. sank 2.8% on profit-taking from its four-year high after four consecutive trading days of gains.

Hong Kong's Hang Seng shares continued to climb on Tuesday, extending 50.63 points, or 0.37%, to 13,845.63. The top index percentage gainer was Lenovo Group, which went further up after surging 4.7% yesterday. The mainland PC maker posted a 10% growth in its nine-month profit on today and resume trading on Feb. 14.

Canada's benchmark TSX/S&P gained 29.70 points, or 0.22%, to close at 9.392.68.

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