Wednesday 21 December, 5:00 PM GMT (Thomson Financial): European markets
ended the trading session higher on broad gains, with the chemicals and
basic resources sectors as the star performers. This was supported by
robust gains in Asia and replicated by a strong opening performance on
Wall Street.
In corporate news, Royal Philips Electronics said its cathode ray tubes
business joint venture will book a one-time non-cash impairment charge of
418 million euros as the success of flat displays had increased the
pressure on demand and prices. Novartis reiterated its commitment to
pursuing and completing its previously announced acquisition of Chiron,
while BAE Systems traded higher on closer defence ties between the U.K.
and Saudi Arabian governments, involving the modernisation of the latter's
armed forces.
In the banking sector, Deutsche Bank agreed to sell 21.16% in Atradius,
while Banco Comercial Portugues lost out to Erste Bank in winning the bid
in the privatisation of a majority stake in Romania's Banca Comercial
Romana. Meanwhile, Deutsche Bank Chief Execuitve Officer Josef Ackermann
and his co-defendants faced a retrial in court with regards to large
payouts during Vodafone's takeover of Mannesmann.
Finally, the latest minutes from the Bank of England's Monetary Policy
Committee (MPC) recorded an 8-1 vote to keep U.K. interest rates on hold.
One member of the MPC voted to reduce interest rates.
London's FTSE-100 Index was up 39.50 points or 0.71% to 5,587.40, while
Paris's CAC-40 Index was up 48.93 points or 1.04% to 4,752.41. Frankfurt's
DAX Index was up 40.63 points or 0.76% to 5,397.23 and Milan's S&P MIB
Index was up 265.0 points or 0.75% to 35,803.0. The pan-European blue chip
Dow Jones Stoxx 50 Index was up 14.32 points or 0.43% to 3,363.54.
* Royal Philips Electronics said LG.Philips Displays, the Cathode Ray
Tubes business-joint venture between Philips and LG Electronics, has
booked one-time non-cash impairment charges amounting to approximately 418
million euros and a cash charge of 42 million euros impairment charges,
which it will book in the fourth quarter of 2005. This was because the
success of flat displays had increased the pressure on demand and prices
for Cathode Ray Tubes.
* Novartis reiterated its commitment to pursuing and completing its
previously announced acquisition of the approximately 56% of Chiron
Corporation that it does not already own on the terms of the merger
agreement entered into between the two parties in October.
* A German Federal Court of Justice ruled that Deutsche Bank Chief
Execuitve Officer Josef Ackermann and his co-defendants will be retried in
court with regards to large payments made during Vodafone's takeover of
Mannesmann.
* Meanwhile, Deutsche Bank agreed to sell 21.16% in Atradius, the
Amsterdam based credit insurer, to Credito y Caucion, based in Madrid, and
Seguros Catalana Occidente, based in Barcelona for 208 million euros.
Following the transaction, Deutsche Bank will retain a 12.73% stake in
Atradius.
* Shares in Banco Comercial Portugues remained sharply higher on relief
that it had failed to win the bidding in the privatisation of a majority
stake in Romania's Banca Comercial Romana (BCR), and therefore would avoid
a substantial rights issue. Instead, Austria's Erste Bank won the right to
buy 61.88% of BCR for 3.75 billion euros.
* U.K. marketing services group Aegis Group said after eleven months of
trading, its underlying results remained in-line with expectations. This
was accomplished despite slightly weaker than expected growth in
advertising expenditure and strong price competition in traditional media
markets. Offsetting these factors, however, were better-than-expected
growth in its specialist media businesses and first time contributions
from acquisitions made earlier in the year.
* The Swiss government said incumbent telecommunications operator Swisscom
will be allowed to take on a maximum of 5 billion Swiss francs in debt for
acquisitions and investments as long as it doesn't buy foreign companies
with a universal service obligation.
* Shares in BAE Systems made gains after the U.K. and Saudi Arabian
governments signed an understanding document, intended to establish a
greater partnership in modernising the Saudi Arabian Armed Forces and
developing close service-to-service contacts, especially through joint
training and exercises. Reports suggested an order for Eurofighter
aircraft and upgrades to its existing Tornado aircraft.
* Linde acquired the American specialty gases company Spectra Gases from
the founding family Alvin and Andy Dietz. The contractual parties have
agreed to maintain silence about the purchase price.
* Shares in German pay-television operator Premiere plummeted after the
German soccer league, the DFL, awarded exclusive rights to broadcast
topflight German soccer matches to rival Kabel Deutschland.
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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