European Indexes End Mixed

Markets in Germany and the UK posted gains while the French benchmark sagged on weakness in automakers

Germany: The Xetra-Dax index ended Friday's choppy session with gains as Wall Street traded higher amid a much better-than-expected first read on third quarter US GDP, namely +3.8%, but a larger-than-expected decline in consumer sentiment. Of local note, Deutsche Bank (DB ) (+0.2%) tabled forecast-beating third quarter net profit of €991 million, up 46% year-over-year, on revenues 31% higher at €6.62 billion. Germany's largest listed bank said it is confident it will meet its financial targets for the year. Software AG (+4.23%) topped estimates with third quarter license sales up 16% year-over-year at €29.2 million, and said full-year licence sales growth will come in at the top end of its forecast range of 10-12%. The UN oil for food inquiry accuses Siemens (+0.77%) of paying Iraq kickbacks. DaimlerChrysler (DCX ) (-0.2%) is also involved.

Meanwhile, MAN (+0.66%) is claiming £300m plus costs in its case against UK's Freightliner Ltd, part of DaimlerChrysler, having won the judgement in London's High Court. The precise amount to be paid will be determined by the court. Generally, auto stocks were in focus after Peugeot lowered its guidance after the close yesterday. SAP (SAP ) (+0.44%) plans a four-for-one share split, but no capital hike. E.on (+1.66%), bouncing back following yield related weakness yesterday, plans to cut charges for use of its networks, leading to lower prices. Linde (+2.18%) was well bid ahead of third quarter results on Monday. CSFB forecasts sales of €2.31 billion and net profit of €128m.

UK: The FTSE index ended higher on Friday with oil, telecoms and pharma stocks holding firm. Meanwhile, better-than-expected US third quarter GDP data supported a positive trend on Wall Street, as US investors chose to sidestep a sharper-than-expected fall in consumer sentiment as well as a disappointing outlook statement from Microsoft (MSFT ). Royal Dutch Shell (RD ) (+1.01%) and GlaxoSmithKline (GSK ) (+2.51%) lifted the market after strong earnings results yesterday. Advertising group WPP (-0.27%) said third quarter like-for-like revenues rose 5%, a slightly lower rate than in the first half.

Bakery group RHM (-8.62%) sank after reporting a 12% fall in cakes sales. Vodafone (VOD ) (+1.77%) invests in Indian mobile operator Bharti Tele-Ventures. BAT (BTI ) (+1.67%) was boosted by positive broker comments. Scottish Power (+0.47%) plans to build a US$270 million 200MW wind farm in the US.

On the broker front, UBS upgraded GlaxoSmithKline to buy from neutral and raised its target price to £17.00 from £14.00, and cut target on AstraZeneca (-0.6%) to £26 from £26.50. Morgan Stanley saw ICI (+0.45%) as a buying opportunity and reiterated its overweight rating.

France: The CAC 40 index (-0.22%) closed lower as upbeat trade on Wall Street failed to provide support. The US showed mixed US macro data, with a much better-than-expected first read on third quarter US GDP, namely +3.8%, but a larger-than-expected decline in consumer sentiment. In Paris, a trickle of results failed to impress investors. Peugeot (-4.75%) pared earlier losses but remained in the red after cutting its fiscal year operating profit and sales targets. Peer Renault (-2.16%) stalled as Nissan posted a steeper-than-expected decline in operating results.

French IT groups picked up after falling on read-across from Microsoft. Business Objects (BOBJ ) (-0.75%) revived to a degree after earlier steeper losses. The IT group reported better-than-expected third quarter sales and disclosed higher fiscal year guidance. Iliad (-0.75%) also picked up, having posted third quarter sales up 46% at €183.4 million, boosted by solid demand in broadband in France. TF1 (-0.43%) announced in-line nine months sales, down a slight 0.2%. M6 (+1.66%) tabled third quarter revenues up 7.3%. Areva (-6.35%) took a knock despite issuing third quarter sales up 7.3% at €2.23 billion. The nuclear reactor maker was hurt by news the French government has no plans to float its remaining stake. In other news: toll operators were in focus after the government said may not sell its stake in ASF (+1.02%), according to Le Figaro. The announcement is taken to be a call for ASF suitor Vinci (unch.) to pay a fair price for the toll operator.

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