Europe Factors to Watch-Shares seen up; eyes on Washington

Fri Dec 28, 2012 2:29am EST

PARIS, Dec 28 (Reuters) - European stocks are seen edging higher on Friday,
lifted by fresh hopes that a deal will be reached to avoid the U.S. "fiscal
cliff".
    At 0717 GMT, futures for Euro STOXX 50, for Germany's DAX 
and for France's CAC were up 0.1-0.2 percent.
    U.S. President Barack Obama and lawmakers are set to have a last round of
talks before a New Year's deadline to reach a deal and avoid massive tax hikes
and spending cuts which could drag the economy into recession.
    Obama and Vice President Joe Biden will meet congressional leaders from both
parties at the White House on Friday at 2000 GMT. 
    "With U.S. President Barack Obama having reportedly cut his holiday short
and returning to Washington to meet U.S. leaders for last ditch talks, there is
growing optimism that a deal can be knocked before the deadline," IG strategist
Stan Shamu wrote in a note.
    In its last session of the year, Japan's Nikkei average climbed to a
21-month high and posted its best yearly gain since 2005, as the yen weakened
further on rising expectations of aggressive monetary stimulus under new Prime
Minister Shinzo Abe. 
    Investors will also keep an eye on Italy's debt auction on Friday, with the
country set to offer up to 3 billion euros of five-year bonds and the same
amount of 10-year paper in the first sale of longer-term debt to be settled in
2013.
     Analysts expect the auction, the last to be held this year, to sail through
after Rome had no trouble placing 11.75 billion euros of short-dated paper on
Thursday, helped by debt redemptions. 
    European stocks ended mostly flat on Thursday in low volumes, with the
FTSEurofirst 300 index hovering a few points below a 19-month high hit
last week, as market players sought clues on whether U.S. politicians will reach
an agreement on time to avoid the so-called fiscal cliff.
    The FTSEurofirst 300 is set to post a gain of 14 percent for 2012 while the
euro zone's blue chip Euro STOXX 50 index has risen 15 percent, both
indexes enjoying their best annual performance since the sharp bounce of 2009.
    
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 MARKET SNAPSHOT AT 0716 GMT                            
                                         LAST  PCT CHG  NET CHG
 S&P 500                             1,418.10  -0.12 %    -1.73
 NIKKEI                             10,395.18    0.7 %     72.2
 MSCI ASIA EX-JP                       547.00   0.46 %     2.50
 EUR/USD                                1.325    0.1 %   0.0013
 USD/JPY                                86.42   0.38 %   0.3300
 10-YR US TSY YLD                       1.732       --     0.00
 10-YR BUND YLD                         1.328       --     0.00
 SPOT GOLD                          $1,661.60   -0.1 %   -$1.69
 US CRUDE                              $91.26   0.43 %     0.39
 
  > GLOBAL MARKETS-Yen falls, Asian shares up on US fiscal hopes 
  > Wall St rebounds on House session, but off for 4th day 
  > Tokyo's Nikkei share average closes up 0.70 pct 
  > TREASURIES-Steady in Asia ahead of weekend 'fiscal cliff' talks 
  > FOREX-Yen hits 2-year low on expectations for bold BOJ easing 
  > PRECIOUS-Gold on track for best weekly gain since Nov 
  > METALS-Copper edges up, U.S. fiscal worries curb gains 
  > Brent climbs above $111 as US leaders set to resume budget talks 
    
    COMPANY NEWS:
    
    PORSCHE SE, VOLKSWAGEN 
   Porsche SE on Thursday won the dismissal of a New York lawsuit by 26 hedge
funds that accused the German sports-car maker's holding company of deceptive
manipulation of the market for VW shares in 2008. 
    
    BANKIA 
    Spanish state-rescued lender Bankia will be excluded from the
country's blue-chip index as of January 2 until the results of a
recapitalisation are clear, the Spanish stock exchange operator said on Thursday
 
    
    VINCI 
    The company won a tender to buy a 95 percent stake in Portuguese airports
operator ANA after it outbid three international consortia with its 3.08
billion-euro offer. 

    ZURICH INSURANCE 
    The company said it will book a pretax profit and release $340 million in
capital over two years by disposing of U.K. daughter Eagle Star to RiverStone
Insurance, part of the Swiss insurer's strategy to sell non-core activities and
redeploy capital. 
    
    LONMIN 
    Lonmin CEO Ian Farmer is stepping down due to illness. 
    
    KBC 
    Belgian banking and insurance group said on Friday that it had agreed to
sell its 22 percent stake in Nova Ljubljanska Banka (NLB) to Slovenia for 2.8
million euros, one of the last remaining divestments required by EU regulators.
 
    
    IBERDROLA 
    Spanish utility said on Friday it had agreed to sell its 20 percent stake in
the Medgaz pipeline to Belgian company Fluxys for 146 million euros
($193 million). 
    
    LONZA 
    The firm said it concluded the sale of its Brandenburg, Kentucky-based
performance urethanes and organics business to Monument Chemical for an
undisclosed price, part of the Swiss firm's strategy to focus on core activities
following the acquisition of Arch Chemicals. 
    
    BANCA MONTE DEI PASCHI DI SIENA 
    The Italian lender would have to offer the treasury a big discount if it
decided to convert into shares the bonds it is issuing to the state under a
bailout scheme, an official document showed. 
    
    BANCA POPOLARE DI MILANO  
    Italy's lender said on Thursday it is ending a commercial partnership with
French Credit Industriel et Commercial (CIC), part of Credit Mutuel group.
 
    
    IMPREGILO  
    The general contractor said on Thursday it completed the sale of a 19
percent stake in Brazil-based EcoRodovias for 619 million euros. Adding to a
3.74 percent of the Brazilian company sold at the end of October, the overall
cash received totals 731 million euros, the company said.