European Indexes Finish Lower

A rundown of Monday's action on major European stock exchanges


The CAC 40 (-1.01%) closed the session in the red while Wall Street trades lower. Of local note, EADS (-2.34%) is facing US order cancellations, Le Figaro reported. Lufthansa has formally announced its interest in buying a stake in Austrian Airlines, which is in the process of being privatised. AIR FRANCE-KLM (-2.19%) is also reportedly interested in the Austrian carrier. Naza Group, a Malaysian automaker, is in talks with PSA (+0.24%) to make Malaysia its southeast Asian manufacturing hub for Peugeot cars, the Malaysian Reserve reported. Serge Tchuruk, the chairman of ALCATEL LUCENT (-1.26%), told Le Figaro the nominations for new top executives will be made quickly. In the wider market, NICOX (+2.57%) rebounded on upbeat comments from CEO Michele Garufi, who told Bloomberg that Nicox's most advanced treatment will be a commercial success. Earlier, Nicox shares fell after the company announced that its US partner Pfizer had decided to drop eye drug trials. In broker news, Landsbanki Kepler downgraded MERCIALYS (+0.350%) to reduce from hold.


Xetra-Dax (-0.72%) closed the first day of the trading week in the red. In spite of better-than-expected existing home sales, US markets continued to lose ground, as credit concerns persisted. WTI crude retreated to US$114.43. Banks were at the centre of attention in Germany today, as COMMERZBANK (-1.71%) was thought to be in the process of sealing a deal with ALLIANZ's (+0.5%) Dresdner Bank. A decision is expected by the end of the week. Staying with M&A news, LUFTHANSA (-0.38%) formally announced its interest in buying a stake in Austrian Airlines, which is in the process of being privatised. Meanwhile, Der Spiegel reported that Lufthansa's holiday airline Eurowings was in tie-up talks with ARCANDOR's (+2.51%) Condor. MLP's (-1.16%) CEO, Uwe Schroeder-Wildberg, told Swiss publication Cash Daily that he believed Swiss Life's takeover plans would fail, pointing out that the cap injection, announced last week, was a clear message that MLP is not up for grabs. CONTINENTAL (-0.14%) named Karl-Thomas Neumann its new CEO. Key broker action included WestLB upgrading WIRECARD (+0.13%) to buy and cutting its target on HOCHTIEF (-0.81%). See Broker Views & News - Germany. Finally, ADIDAS (-2.01%) was marked lower as the Beijing Olympic Games came to an end, curbing enthusiasm for sports wear.


Nordic bourses closed in the red with FORTUM (-1.49%) and STATOILHYDRO (-1.32%) among the losers. Although July existing home sales came in better than expected, Wall Street trades on negative ground as financials weigh. Newsflow was light amid public holiday in the UK. US crude futures came off intra-day lows, with WTI trading at US$114.36/bbl. Of local note, ERICSSON (+0.71%) was top performer in Stockholm as Reuters reported China Unicom will increase capital spending in 2008 with over 50% to US$6.91bn, stepping up development in its GSM-standard network. StatoilHydro said it has discovered oil under the Dagny structure in the North Sea, and gas at the deep-water Snefrid South prospect in the Norwegian Sea, estimating 100m-125m boe, and 4bn standard cubic metres of recoverable gas. In other news, troubled SAS (-1.72%) fell as it faces lawsuits from several Swedish blue chips, such as IKEA and H&M (-0.63%), following losses on the back of price fixing on air freight services, public service television SVT reported on Friday. REC (-4.38%) selected a factory site in Canada to build the next phase of silicon materials expansion. On the upside, AKER SOLUTIONS (+1.77%) booked a US$35m contract from DSME to deliver a deepwater drilling riser system. GENMAB (+1.56%) plans four new studies of ofatumumab in chronic lymphocytic leukemia and non-hodgkin's lymphoma this year.


Piazza Affari ended in the red on a slow day for news in Europe with the UK shut for a public holiday. Wall Street was trading lower at the time of the European close, as credit concerns weigh on financials. WTI trades at US$114.50/bbl. Locally, the major banks INTESA SANPAOLO (-1.53%) and UNICREDIT (-1.28%) were the biggest decliners on a points basis. Elsewhere, the Agnelli family holding company Giovanni Agnelli & C Sapaz has acquired a 6.13% stake in IFI (+0.42%) at EUR 13/sh and is evaluating several options stemming from the purchase. Meanwhile, IFIL (-0.63%) has suspended its share buyback programme. Italian competition authorities have approved FINMECCANICA's (+0.17%) buy of DRS Technologies. CELL THERAPEUTICS (+4.95%) announced a 1-for-10 reverse stock split, effective as of 31 August. SEAT's (+3.57%) shares added to recent gains amid ongoing speculation regarding a possible new investor, or potential divestments. In broker moves, Exane BNP-Paribas downgraded MARIELLA BURANI (-0.42%) to underperform.

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