Tuesday 13 December, 1:00 PM GMT (Thomson Financial): European markets are
edging slightly higher ahead of tonight's U.S. Federal Reserve decision on
interest rates and more importantly its monetary policy outlook for 2006.
Previous comments have highlighted a possible end to the current interest
rate hike cycle in the near future and investors are hoping for more of
the same rhetoric.
The oil & gas sector remains in front as Royal Dutch Shell announces a
capital investment program of around US$19 billion for 2006. Elsewhere,
Pernod Ricard has signed an agreement to sell its Dunkin' Brands unit for
US$2.425 billion, while FirstGroup is awarded both the Greater Western and
Thameslink/Great Northern rail franchises in a deal is worth over 1
billion pounds in revenue per annum.
Cadbury expects revenue growth to be around the top end of its range for
the year, while EMI Group has reached an agreement to sell its CD and DVD
manufacturing business in Japan to a consortium led by Memory-Tech
Corporation. Finally, The European Court of Justice says the U.K. is wrong
to prohibit Marks & Spencer from deducting losses made in France, Belgium
and Germany if the company could not claim the losses in those countries.
Finally, Germany's ZEW economic expectations index has soared in December
to 61.6 from 38.7 in November.
London's FTSE-100 Index is up 21.50 points or 0.39% to 5,523.0, while
Paris's CAC-40 Index is up 24.31 points or 0.52% to 4,697.44. Frankfurt's
DAX Index is up 7.37 points or 0.14% to 5,308.58 and Milan's S&P MIB Index
is up 72.0 points or 0.21% to 34,958.0. The pan-European blue chip Dow
Jones Stoxx 50 Index is up 10.67 points or 0.32% to 3,349.75.
* Royal Dutch Shell has announced a capital investment program for 2006
of around US$19 billion in support of its strategy of more upstream and
profitable downstream. Planned 2006 Upstream investment is around US$15
billion, with the remaining investment in its Downstream operations.
* Pernod Ricard has signed an agreement to sell its Dunkin' Brands unit
together with other related assets to a consortium of buyers made up of
Bain Capital, The Carlyle Group and Thomas H. Lee Partners for US$2.425
billion. The sale of Dunkin' Brands is in line with the group's policy of
focusing on its core Wine & Spirits business.
* Cadbury Schweppes says trading has continued in line with expectations
since its last update in early October. It expects revenue growth to be
around the top end of its range for the year. Growth has been strong in
2005 in its confectionery business across the world and in its beverage
businesses in the Americas and Australia. The group is benefiting from
increased investment in growth, with innovation playing a significant role
in driving market share gains.
* Novartis says new data from a clinical study have showed that its Femara
drug has led to 69% reduction in risk of breast cancer returning even
years after completing standard tamoxifen therapy. Meanwhile, studies have
also shown that the potential use of its Glivec treatment for leukemia
have demonstrated two-year disease free survival rates of up to 87% and
one-year overall survival of up to 84%.
* FirstGroup plc, the UK's largest surface transport company, has been
awarded both the Greater Western and Thameslink/Great Northern franchises
from the Department for Transport (DfT). The deal is worth over 1 billion
pounds in revenue per annum and will commence operations on 1 April 2006.
* U.K. retailer Marks & Spencer has been granted a 30 million pounds
rebate from its UK tax bill, granted by The European Court of Justice. It
says the U.K. is wrong to prohibit the company from deducting losses made
in France, Belgium and Germany if the company could not claim the losses
in those countries. This paves the way for other companies to offset
foreign losses against group profits if they can't get tax relief in those
foreign countries.
* EMI Group has reached an agreement to sell its CD and DVD manufacturing
business in Japan to a consortium led by Memory-Tech Corporation. This
initiative represents the final major step in EMI's drive to outsource its
manufacturing capability, making these costs fully variable.
* British Energy has reported operating profit of 135 million pounds for
the first half to 2 October and 58 million pounds for the second quarter
to that date, but has not provided year-on-year comparisons due to
restructuring. It has posted earnings before interest, tax, depreciation
and amortization (EBITDA) of 227 million pounds in the first half and 106
million pounds in the second quarter, with higher electricity prices
benefiting the company.
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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