Thursday 1 December, 5:00 PM GMT (Thomson Financial): European markets
gathered momentum throughout the trading session to end higher on broad
gains, providing some compensation from earlier losses in the week. This
was supported by a strong U.S. open on the back of a strong ISM survey and
construction index data.
In Europe, the European Central Bank hiked interest rates by 25 basis
points to 2.25%, the first rate hike in five years. ECB President Jean
Claude Trichet played down speculation of replicating the U.S. Federal
Reserve's style of making a series of interest rate hikes, adding that
monetary policy remained accommodative and that the ECB would monitor
economic data before taking any further interest rate decisions.
On the corporate side, HSBC's trading updated provided some reassurance
amongst banking stocks with continued progress in its third quarter
performance. Elsewhere, Thyssenkrupp announced a rise in full year pre-tax
profits to 1.84 billion euros from 1.48 billion euros last year while
United Utilities recorded a 20% year-on-year rise in first half pre-tax
profits to 244 million pounds.
In M&A news, Prudential made an offer to acquire the remaining 21.7% of
on-line banking unit Egg it does not already own while TNT sold the
majority of the contract logistics activities and part of the
transportation activities of its French subsidiary TNT Logistics Holdings
to Norbert Dentressangle. Meanwhile, Punch Taverns announced the proposed
acquisition of Spirit Group for 2.679 billion pounds.
London's FTSE-100 Index rose by 62.90 points or 1.16% to 5486.10, while
Paris's CAC-40 Index ended up by 69.05 points or 1.51% to 4636.46.
Frankfurt's DAX Index has climbed by 73.15 points or 1.41% to 5266.55 and
Milan's S&P MIB Index added 495 points or 1.45% to 34,585. The
pan-European blue chip Dow Jones Stoxx 50 Index gained 58.84 points or
1.80% to 3323.37.
* In its latest trading update HSBC said its third quarter performance
reflected continued progress with all its operations delivering higher
pre-tax profits year-on-year. Geographically, the bank said there had been
a broad expansion within the Asia Pacific region, singling out strong
asset and profit growth in the Middle East, driven by the regional
benefits of the strong oil price. HSBC's outlook for the rest of the year
suggested a continuation of the broad trends, although it cautioned that
trading revenues were expected to be lower in the fourth quarter.
* German industrial conglomerate Thyssenkrupp announced a rise in full
year pre-tax profits to 1.84 billion euros compared to 1.48 billion euros
last year, with earnings per share reaching 2.05 euros compared to 1.81
euros previously. Sales grew to 42.1 billion euros from 37.3 billion euros
in the prior year with an order intake of 42.5 billion euros compared to
38.8 billion euros last year. The company said it would increase the
dividend to 0.70 euros per share from 0.60 euros and on top of this, there
would be a special dividend of 0.10 euros per share as a result of its
virtually completed divestment program.
* U.K. water and power group United Utilities recorded a 20% year-on-year
rise in first half pre-tax profits to 244 million pounds. Operating profit
rose to 366.5 million pounds from 337.9 million pounds in the prior year,
on revenues of 1.157 billion pounds from 1.025 billion pounds last year,
while the interim dividend per ordinary share was lifted by 3.4% to 14.29
pence. Meanwhile, Philip Green was appointed as the company's new Chief
Executive with effect from 31 March 2006, a post currently being held by
John Roberts.
* U.K. insurance group Prudential made an offer to acquire the remaining
21.7% of on-line banking unit Egg it does not already own. The offer
valued the existing issued share capital of Egg at 973 million pounds, a
15% premium to the market capitalisation on 30 November 2005, the last
business day prior to announcement.
* Logistic services group TNT signed an agreement to sell the majority of
the contract logistics activities and part of the transportation
activities of its French subsidiary TNT Logistics Holdings to Norbert
Dentressangle. As previously disclosed, the expected negative financial
impact relating to the sale and refocus of the French logistics business
unit is to be up to 140 million euros and will be mostly booked in 2005.
* Swiss Life outlined its future strategy at an investor day conference
with the aim of achieving net profits of 1 billion Swiss francs and return
on equity over 10% by 2008.
* Nokia unveiled plans to expand its mobile device production in Dongguan,
China, designed to provide further capacity and flexibility in order to
meet the growing worldwide market demand, especially in China and in Asia.
The company said factory expansion will commence in the third quarter of
2006.
* Punch Taverns announced the proposed acquisition of Spirit Group, with
an acquisition value of 2.679 billion pounds, which will bring the total
number of pubs to over 9,500 from 8,200 before. Meanwhile, Punch Taverns
sold 203 pubs to Admiral Taverns Limited for 40 million pounds, in line
with the company's stated intention to improve the overall quality of the
estate by the disposal of non-core pubs that do not fit its long-term
strategy.
* National Express Group received competition clearance from Spanish
competition authorities, clearing the way for it to complete is
acquisition of Alsa, the largest private coach and bus operator in Spain
operating a fleet of approximately 1400 vehicles.
Simon.Tse@Thomson.com; Thomson Financial
This is Thomson Financial Corporate Services Europe Market Commentary.
The information herein is believed to be true and accurate. If you have
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SOURCE Thomson Financial Corporate Group
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