Europe Lower, Asia Mixed
European stock markets are lower on Wednesday. In London, the Financial Times Stock Exchange 100 lost 5.70 points, or 0.11%, to close at 5053.20 The FTSE closed in negative territory, with BHP Billiton's doubling of first-half net profit offset by the effect of several large companies trading ex-dividend and a lower start on Wall Street. At home, media operator Reuters posted fiscal year core revenues of 2.361 billion pounds, vs. a consensus of 2.338 billion pounds, with profits of 438 million pounds and earnings per share of 25.2 pence. Companies trading ex-dividend today included BP, GlaxoSmithKline, Scottish Power, and Compass Group.
Germany's DAX lost 33.26 points, or 0.53%, to close at 4368.77. Frankfurt closes towards intraday lows, dragged off highs by comments from Alan Greenspan who said interest rates remain fairly low. US industrial production came in unchanged earlier as energy demand waned in the face of mild weather. Of local note, Metro bucked the overall negative tone to the session after Merrill Lynch upgraded the stock to buy from neutral. Car stocks were in focus after January W. European data show car sales slipped 0.2% to 1.17m units, with sales in Germany falling 3.7% as rising unemployment discourages buyers. Both VW and DaimlerChrysler's sales dropped. BMW reported its Asian sales rose 6.5% in 2004, although sales in China fell 10%. Commerzbank slipped on profit-taking after reporting fourth-quarter corporate client business rising 69% as it slashes provisions for risky loans and earns more from interest. Adidas gained after yesterday saying it's to increase its dividend by at least 21%. Puma gained after CSFB raised its price target, saying recent negativity following fiscal year 2004 results was overdone.
In France, the CAC-40 lost 21.43, or 0.53%, to close at 4009.02. The CAC40 ended lower on Wednesday, although a number of stocks managed to to stage a late turnaround and close in positive terrain. Banks were the main drag on the index as investors remained cautious ahead of Fed chairman Alan Greenspan's addresses a Senate panel today. The Dow slipped 0.25% and the Nasdaq 0.09% after Greenspan's comments were taken as a sign that there was room for more hikes. Among local reports, Pernod-Ricard and Lagardere were among those stocks to have performed an impressive about-turn in afternoon trading. Traders noted that both stocks had broken through resistance levels. Lagardere is also expected to make a move to buy a stake in Canal Plus from Vivendi, with a view to becoming a pure media play. Credit Agricole's Credit Lyonnais unit and the French govt have tentatively agreed to settle a $600 million civil suit filed by California Insurance Commissioner, over 1992 purchase of Executive Life by Credit Lyonnais in violation of federal law.
Asian markets were mixed on Wednesday. In Japan, the Nikkei 225 lost 44.81 points, or 0.38%, to close at 11,601.68, after Japan's GDP unexpectedly shrank 0.5% in the three months ended Dec. 31 throwing the economy back into recession. Japan's economy also shrank in the previous two quarters, according to revised figures. Real estate stocks led the drop after Sumitomo Realty lowered its full-year profit forecast. Mitsubishi Estate declined 2.1% to 1,298 yen and Mitsui Fudosan lost 2% to 1,315 yen. Kajima Corp. slid 3.6% to 430 yen. Tokyo Electron advanced after Applied Materials said the "outlook is improving" and reported first-quarter profit above some analysts' estimates. Toshiba jumped 1.6% to 447 yen.
Hong Kong shares rose on Wednesday for the fifth day in six. The benchmark Hang Seng Index gained 19.66 points, or 0.1%, to 14,015.49. Among 33 blue chips, 13 climbed while nine declined. The top HSI percentage gainer was Esprit, whereas the top laggard was Wheelock & Co. Titan Petrochemicals Group rose after saying 2004 earnings climbed almost fourfold.
Canada's benchmark TSX/S&P gained 69.56 points, or 0.73%, to close at 9,639.59.