European Factors to Watch-Shares seen flat to lower as U.S. talks stall

Tue Dec 4, 2012 2:17am EST

By Francesco Canepa
    LONDON, Dec 4 (Reuters) - European stocks were expected to open flat to
lower at the open on Tuesday after U.S. budget negotiations to delay
growth-curbing austerity measures hit a roadblock and some key regional indexes
failed to break above resistance levels.
    At 0714 GMT, futures for the Euro STOXX 50 and France's CAC 
were flat, while contracts on Germany's DAX shed 0.1 percent and futures
for Britain's FTSE 100 fell 0.2 percent.
    The White House dismissed a budget deal proposal from congressional
Republicans that included tax reforms and spending cuts, saying it did not meet
President Barack Obama's pledge to raise taxes on the wealthiest Americans.
 
    U.S. political parties are discussing ways to delay a $600 billion "fiscal
cliff" of year-end austerity measures that could send the world's largest
economy into recession.
    "(A) bad taste left over from the U.S. session was the bitterness over the
fiscal cliff that appears to be brewing between the Republicans and the White
House," Jonathan Sudaria, a dealer at Capital Spreads, said in a trading note.
    "With the deadline getting closer and time running out fast, the public
derision of each others proposals isn't instilling much confidence amongst
traders that an agreement is any nearer to being reached." 
    The Euro STOXX 50 ended 0.3 percent higher at 2,582.36 points on
Monday, erasing most of the day's gains on the back of disappointing U.S.
manufacturing data.    
    In a sign of buyers' lack of conviction, the Euro STOXX 50 failed to break
above a strong resistance at 2,611, a 2012 high set in March, and edged below
its September high at 2,600 by the close.
    Britain's FTSE 100 hit a ceiling at 5,900 for the second time in as
many sessions before closing the day up a meagre 0.1 percent at 5,871 points,
showing the recent rally was running out of steam and leading some short-term
traders to position for a pullback.
    "We will trade the break of (Monday's) low (at 5,875) with a stoploss above
the day's high (at 5.902)," the head of a London-based technical trading firm
said.
    "If we do not get triggered into the trade, it will signal to us that there
is no bearish momentum so will thus invalidate our reason to short - and we will
remove the order." 
--------------------------------------------------------------------------------
  
                                              
 MARKET SNAPSHOT AT 714                    
 GMT                                       
                            LAST  PCT CHG     NET
                                              CHG
 S&P 500                  1,409.  -0.47 %   -6.72
                               6           
 NIKKEI                   9,432.  -0.27 %  -25.72
                               6           
 MSCI ASIA    <.MIASJ000          -0.12 %   -0.64
 EX-JP        PUS>                         
 EUR/USD                  1.3064   0.08 %  0.0011
 USD/JPY                   82.07  -0.19 %  -0.160
 10-YR US     <US10YT=RR   1.628       --    0.01
 TSY YLD                                   
 10-YR BUND   <EU10YT=RR   1.415       --    0.00
 YLD                                       
 SPOT GOLD                $1,703  -0.64 %  -$10.9
                              90           
 US CRUDE                 $88.72  -0.42 %   -0.37
 
    
    
  > Asian shares fall from 9-month high on weak U.S. data  
  > Wall St sours on weak domestic factory data            
  > Nikkei falls as poor U.S. data triggers profit-taking  
  > Treasuries slip on Spain aid, Chinese data             
  > Dollar slips vs yen; RBA rate decision awaited         
  > Gold edges down as US fiscal talk uncertainty weighs   
  > Copper drops from 6-week high, U.S. woes weigh         
  > Brent slips on weak US data, 'fiscal cliff' woes       
    
    COMPANY NEWS
    
    GERMAN AUTO STOCKS   
    Porsche said its November sales in the United States jumped by 71 percent 
to 3,865 vehicles, thanks to demand for the Porsche 911 and the Cayenne SUV.
    Daimler's Mercedes-Benz USA reported a 15.6 percent gain in November sales
to 32,649 vehicles. And BMW said its U.S. sales rose 38.8 percent to 36,461
vehicles during the month.
    
    MAN 
    MAN plans to scale back production of trucks from Jan. 14 as its customers
hold off placing major orders in uncertain economic times, the head of its truck
business said. 
    
    ARCELORMITTAL 
    Canada, hoping to spur economic development of its far north, has approved
the construction of a massive iron ore mine in the Arctic territory of Nunavut
that could help the top steelmaker reduce its dependence on outside suppliers.
 
    South Korean steelmaker POSCO has secured exclusive negotiating
rights to acquire a stake in a Canadian iron ore mine operator controlled by
ArcelorMittal, a source who has knowledge of the matter said. 
 
    DEUTSCHE LUFTHANSA 
    The German flagship airline said it needs to cut costs at its profitable
long-haul business to cope with rising fuel prices and stiff competition from
Gulf carriers. 
    
    E.ON 
    Germany's biggest energy group agreed on Monday to take over Austrian firm
Verbund's stake in Turkish energy firm Enerjisa, pushing ahead with
its foreign expansion. 
    
    ELECTRICITE DE FRANCE 
    The French state-controlled power giant raised the estimated construction
cost of its next-generation nuclear reactor by one-third to 8 billion euros.
 
    
    AXA 
    Planned new capital rules for European Union insurers have cut the value of
European stocks by nearly ten percent over the last three years, the French
insurer said. 
    
    REPSOL 
    Spanish oil major Repsol filed a complaint against Argentina at the World
Bank's international arbitration forum on Monday over the government's
expropriation this year of Repsol's controlling stake in YPF. 
    
    VIVENDI, BOUYGUES 
    Bouygues Telecom said it had been holding discussions with Vivendi's SFR
about sharing their mobile networks outside France's major cities.
 
    
    FRANCE TELECOM 
    The French telecom group will exit STOXX Europe 50, Europe's
blue-chip index, from December 24 and be replaced by the world's second largest
luxury goods group, Richemont, STOXX said in a press release.
 
    
    NOKIA SIEMENS NETWORKS  
    A service unit of Nokia Siemens Networks (NSN) in Germany faces
closure, affecting 1,000 jobs, after losing a contract with its biggest
customer, German daily newspaper Sueddeutsche Zeitung reported. 
    
    DEUTSCHE TELEKOM 
    Sprint Nextel Corp is unlikely to make a counteroffer for MetroPCS
Communications, the U.S. mobile operator that Deutsche Telekom plans to
merge with its T-Mobile USA unit, three people familiar with the matter said
on. 
    
    TELIASONERA  
    The findings from an independent investigation into TeliaSonera's dealings
in Uzbekistan, are likely to be delayed until the end of January, as lawyers
have not been able to contact some of the key players, Bjorn Riese, chairman of
law firm Mannheimer Swartling conducting the probe, told Swedish daily Svenska
Dagbladet. 
    TeliaSonera's purchase of a 3G license is also being examined by Swedish
prosecutors after allegations its payment in the deal amounted to bribery and
money laundering.
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.