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European Markets Summary

London Stocks Close Slightly Lower

FTSE 100 closes 0.4% lower at 5745.29, but faring much better than European counterparts, with support from heavily-weighted mining stocks. Fresnillo ends +3.2% after reporting better-than-expected 1Q gold production; BHP Billiton +0.9% after its quarterly production update. Still, banks suffer heavy losses; Lloyds Banking Group down 3.2%, RBS off 3.1%, Barclays 2.9% lower. Overall sentiment towards the sector is downbeat, as the IMF warns that European banks are risking a new global financial crisis through the large-scale shrinking of their balance sheets. There are no major UK data releases due Thursday; but, in the US, initial jobless claims are at 1230 GMT, while existing home sales and Philadelphia Fed index are at 1400 GMT.

Frankfurt Stocks End Firmly Lower

DAX ends 1% lower at 6732.03, on profit-taking ahead of Spain’s auction of government debt Thursday, traders say. Widening French CDS have sparked concerns, adds one; and an IG Markets strategist points to rising non-performing loans in Spain. Commerzbank ends down 2.2% and Deutsche Bank off 2.1%, following French and Spanish peers. Siemens off 2.5% on continuing fears of a possible profit warning, says a trader. ThyssenKrupp ends 2.9% higher after Davy Research says the company’s Brazilian plant “has turned the corner.”

Paris Stocks Close Sharply Lower

CAC-40 ends 1.6% lower at 3240.29, on renewed concerns over Spain, a day ahead of a crucial auction of the country’s 10-year debt, says a Paris trader. Banks are hardest hit, with BNP Paribas down 3.2%, Societe Generale off 5% and Credit Agricole 4.4% lower. Still, Danone closes 1.5% higher Citi upgrades the stock to buy and Societe Generale adds it to its premium list. Accor ends 0.4% higher after reporting a healthy rise in 1Q sales.

Amsterdam Stocks End Firmly Lower

AEX closes 1% lower at 309.99 as investors await the auction of Spanish 10-year debt Thursday, the outcome of which will likely determine sentiment throughout the day. Air France-KLM sheds 4.5%, Boskalis drops 4.4%, KPN falls 3.8%. ASML loses 1.6% after reporting a fall in 1Q net profit. But Heineken is the top gainer, ending 2.5% higher after strong 1Q results. The local corporate calendar has Akzo Nobel and Nutreco 1Q updates.

Zurich Stocks Close Slightly Lower

SMI ends 0.4% lower at 6173.35 as financials fall amid nervousness in the market about European debt and Spain in particular. Actelion is the day’s biggest faller, down 3%, followed by Julius Baer [2.9%] and UBS [2.6%]. Cyclical Adecco and luxury stocks Swatch and Richemont also lose ground. Defensive Roche gains 1% after announcing it won’t extend its offer for US diagnostics company Illumina. Thursday, attention turns to Actelion, which reports its 1Q results, and the outcome of crucial Spanish debt auctions.

Nordic Stocks End Session Lower

Nordic equity markets end the session lower, amid concerns about Spanish debt despite the country’s easing bond yields. A weak US opening also drags on sentiment. OMXN40 closes 1.2% lower, with OBX down 0.3%. SCA falls 7.7% after reporting a decline in 1Q net profit. Statoil Fuel & Retail rises more than 50% after Statoil ASA’s announcement that Alimentation Couche-Tard Inc will buy the retailer in a $2.8B deal. Eyes Thursday will be on 1Q earnings, including updates from Nokia, MTG and SKF.

Milan Stocks Close Sharply Lower

FTSE Mib ends down 2.4% at 14,580 after Italy moved its balanced budget target back a year to 2014, and on bank losses from continued concerns of contagion from Spain, says a trader. Banco Popolare ends down 5.3%, Intesa Sanpaolo off 5.2% and UniCredit 4.9% lower. Utilities drop on concerns that a stronger Italian economic contraction will hit earnings. A2A slips 5.3%, Enel drops 2.8%. Mediaset off 3% on weak 1Q advertising.

Athens Stocks End Higher, But Banks Fall

ASE closes 0.8% higher at 726.65 on low turnover of EUR25M. However, the banking sub-index falls 2.6% on reports that a government recapitalization plan for the sector may be pushed back until after the country holds elections [May 6]; the plan is expected to be unveiled this Friday. “Investors were starting to cheer about the fact that we will soon have the recap plan and then talk of a delay comes up. This extends uncertainty in the sector,” says a broker. National Bank ends 1% lower, EFG Eurobank down 2.3%, Piraeus Bank off 2.9%, Alpha 2.5% adrift.

Prague Stocks End Touch Higher On Erste

PX ends 0.2% higher at 922.8 as the index gets a boost from Erste, closing +1.7% after Citi lifts its recommendation on the stock to buy from neutral, a trader says. Komercni Banka benefits from interest in the local banking sector, finishing the session +0.3%. Czech Telefonica rises 1.1%, NWR +1.3%. CEZ ends 0.7% lower at CZK767.7 as the share price sticks around CZK770 and faces selling pressure when it moves above that, the trader adds.

 

StockMarketNews Research Team

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