3:47 AM ET Jan 17, 2006
LONDON (MarketWatch) -- European shares declined on Tuesday, as oil prices
climbed back towards $65 a barrel and investors eyed some mixed corporate
news.
Germany's DAX 30 eased 0.9% at 5,463, the French CAC 40 index lost 0.9% at
4,814, while the U.K.'s FTSE 100 index eased 0.6% at 5,705.
All three indexes gave up advances made on Monday, when U.S. markets were
closed for the Martin Luther King Jr. holiday.
The losses also came after a dismal performance in Tokyo, where the Nikkei
225 lost over 400 points.
The front dated light sweet crude oil contract climbed back towards last
year's $65 a barrel mark amid concerns about the political situation in Iran,
after the country broke the seals on some of its nuclear research sites.
Europe and the U.S. are trying to call an emergency meeting of the
International Atomic Energy Agency - which could result in sanctions against
Iran. However, Iran - the world's fourth largest oil exporter - has warned
that sanctions could result in higher oil prices.
Decliners included brewer Heineken, which fell 1.3%, and advertising group
Publicis, which also fell 1.3%.
Turning to European corporate news, Britain's biggest supermarket chain
Tesco eased 1.8% after it said that U.K. comparable sales excluding fuel rose
5.7%, slightly outpacing consensus estimates.
Tesco said that seasonal foods sold well over the Christmas trading period
and it also saw growth in non-food sales, especially home entertainment,
electronics, clothing, toys and gifts. International sales rose 16.1%.
Also in the U.K. publisher Pearson added 0.7% after it said that it closed
its 2005 year in line with expectations, leading to "significant" underlying
growth in sales, adjusted earnings per share, free cash flow and return on
invested capital for the year.
It noted a strong performance in the School, Higher Education,
Professional and international markets divisions of its education business.
Elsewhere, Penguin's fourth-quarter frontlist performed well; the Financial
Times sustained its advertising revenue growth and will reach breakeven; and
IDC expects to report its best year ever, the company said.
Meanwhile Vivendi Universal shares were steady after the scaled-down
French media-and-telecommunications conglomerate said it plans to delist from
the New York Stock Exchange and was also upgraded to buy from hold by ABN
Amro, which said "even in our base case, Vivendi's valuation looks
attractive."
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SOURCE Thomson Financial
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