Friday 23 April, 5:00 PM BST (Thomson Financial): European markets hung
onto their intra-day gains and ended the day and the week in positive
territory, aided by strong corporate earnings and a U.S. dollar which hit a 5-
month high against the euro. The automobiles sector remained the dominant
intraday performer, led by DaimlerChrysler, which decided not to participate
in a capital increase planned by Mitsubishi Motors Corporation (MMC) and to
cease further financial support for MMC. Elsewhere, Ericsson released better
than expected first quarter results as net income came in at 3 billion Swedish
kronor from a loss of 4.3 billion kronor in the same period last year,
although there was some disappointment at the company's guidance. Volvo
unveiled first quarter net income of 2,248 million kronor from 506 million
kronor in the same quarter last year.
London's FTSE-100 Index inched lower, by 1.80 points or 0.04% to 4570.00,
while Paris's CAC-40 Index climbed by 25.88 points or 0.68% to 3811.43.
Milan's MIB-30 Index gained 53 points or 0.19% to 28,597 and Frankfurt's DAX
Index rose by 44.47 points or 1.10% to 4103.62.
* Ericsson released better than expected first quarter results as net
income came in at 3 billion Swedish kronor from a loss of 4.3 billion
kronor in the same period last year. Operating income was 4.5 billion
kronor from a loss of 2.8 billion kronor in 2003, while the gross
margin improved to 44.7% from 34.1% in 2003. The main reasons for the
improvement were better than anticipated benefits from cost of sales
reductions activities and a favourable product mix. Sales rose to 28.1
billion kronor, an increase by 9% year-over-year. High-growth markets
such as China, Brazil and Mexico, were main contributors to this
development. Currency exchange effects were 8%. Due to seasonality,
sales declined by 22% sequentially. Orders booked amounted to 33.0
billion kronor, an increase of 22% year-over-year, driven by generally
strong development in Asia-Pacific, Central Europe, Middle East and
Africa. Sequentially, orders booked increased by 12%. The company
estimated that the global mobile systems market in 2004, measured in
U.S. dollars, will show slight to moderate growth, compared to 2003.
This outlook was mainly driven by growing traffic, network expansions
and continued 3G rollout.
* Shares in DaimlerChrysler ended higher after the company announced it
had decided not to participate in a capital increase planned by
Mitsubishi Motors Corporation (MMC) and to cease further financial
support for MMC. DaimlerChrysler said that following the fall in MMC's
earnings in 2003, a new business plan had been instigated, although
this required substantial financial resources.
* Volvo unveiled first quarter net income of 2,248 million Swedish kronor
from 506 million kronor in the same quarter last year. Income per share
for the first three months was 5.40 kronor from 1.20 kronor in 2003,
while income per share for the most recent 12-month period amounted to
4.90 kronor. Net sales for the first quarter of 2004 increased to
45,489 million kronor compared to 40,931 million kronor in the same
quarter last year, reflecting strong organic growth.
* GlaxoSmithKline announced that the U.S. Food and Drug Administration
had approved the use of Advair 100/50 in children of four years to
eleven years of age with asthma who are symptomatic on inhaled
corticosteroid therapy alone. Advair contains an inhaled corticosteroid
and a long-acting beta2-agonist and is the only long-term preventative
product that treats the two main components of asthma - airway
inflammation and bronchoconstriction.
* Infineon Technologies announced a capacity expansion at its Virginia
subsidiary semiconductor plant, Infineon Technologies Richmond, LP. The
expansion will begin with an initial equipment move in to start
production of advanced DRAM chips on 300mm wafers beginning in early
2005. Infineon said the US$1 billion expansion project would increase
flexibility and responsiveness to customer requirements for its memory
and logic products.
* Gambro posted a first quarter net income of 88 million kronor from 138
million kronor in the same period last year. Earnings per share also
fell by 36% to 0.26 kronor over the same time period. Earnings before
tax were down 10% year-on-year to 326 million kronor, while revenues
were down 2% to 6,365 million kronor.
* BASF has signed an exclusive cooperation agreement with the
British-Canadian company Intelligent Engineering Ltd. (IE) for further
development of the innovative Sandwich Plate System (SPS). The SPS
technology, jointly developed by BASF Group company Elastogran and IE,
is becoming established in the shipbuilding industry for the repair and
construction of ship segments. New SPS applications for the civil
engineering market are now being developed.
* Standard Chartered confirmed that it intends to sell its 9.76% stake in
South Korea's KorAm Bank, realising a net gain in excess of US$90
million. The stake is being sold for 15,500 Korean won per share.
Standard Chartered bought the stake for US$154 million, at an average
purchase price of 9,187 Korean won, in August 2003. Standard Chartered
will continue to expand its Consumer Banking operation rapidly in South
Korea.
Simon.Tse@thomson.com; Thomson Financial
This is Thomson Financial Corporate Group's Europe Market Commentary. The
information herein is believed to be true and accurate. If you have any
questions please e-mail James Sang at james.sang@tfn.com. For more information
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SOURCE Thomson Financial Corporate Group
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