European Factors to Watch -Stocks to steady at 5-year highs

Thu May 16, 2013 2:42am EDT

LONDON, May 16 (Reuters) - European stocks are seen opening flat to lower on
Thursday after setting five-year highs in the previous session, with
disappointing earnings muting a recent rally that has been fuelled by monetary
stimulus.
    At 0631 GMT, futures for Euro STOXX 50, for UK's FTSE 100,
for Germany's DAX and for France's CAC were all flat to 0.1
percent lower.
    The focus will be on euro zone and U.S. inflation data as well as the Philly
Fed business index, with European shares having shrugged off weak GDP data in
the previous session.
    "Despite the stark evidence that all is not well, confidence in the ability
of central banks to steer their respective economies back to health remains
high," Jonathan Sudaria, sales trader at London Capital Group, said in a trading
note. 
    "Whilst the bulls appear to be a little more cautious this morning and the
bears still nonexistent, it's almost certain that a batch of weak economic data
is around the corner to bolster the belief that central banks will be on hand to
help push markets up."
    The euro zone blue-chip STOXX 50 has gained ten percent since
the middle of April, when expectations of a rate cut from the European Central
Bank to a record low were first formed. The cut was delivered on May 2.
    The pan-European FTSEurofirst 300 index closed up 0.7 percent at
1,245.66 points on Wednesday, its highest level since mid-2008. 
    The index received a boost from outperforming Swiss stocks, which could be
weaker on Thursday after Zurich Insurance missed profit expectations,
although Swiss luxury goods company Richemont said sales growth in
April accelerated to 12 percent from 9 percent in the full year ended March.
    The earnings season in Europe has been disappointing. With 89 percent of
STOXX 600 companies having reported, 53 percent have missed
expectations, compared to just 28 percent across the Atlantic on the S&P 500
.
    Once the earning season has finished, European shares could see gains in
excess of the impressive returns that they've managed recently, Nick Xanders,
who heads up European equity strategy at BTIG, said.
--------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0630 GMT:
    
                                           LAST  PCT CHG     NET
                                                             CHG
 S&P 500                               1,658.78   0.51 %    8.44
 NIKKEI                               15,037.24  -0.39 %  -58.79
 MSCI ASIA EX-JP                         559.71   0.14 %    0.80
 EUR/USD                                 1.2861  -0.19 %  -0.002
                                                               5
 USD/JPY                                 102.39   0.16 %  0.1600
 10-YR US TSY YLD                         1.924       --   -0.02
 10-YR BUND YLD                           1.362       --   -0.02
 SPOT GOLD                            $1,393.00   0.05 %   $0.71
 US CRUDE                                $93.72  -0.62 %   -0.58
 
  > Upbeat Japan GDP brings some cheer, but Nikkei misses out 
  > Dow, S&P 500 end at record highs again, Google jumps 
  > Nikkei dragged by weak capital spending data, Olympus soars 
  > Tresury prices rise on weak manufacturing, inflation data 
  > Dollar weakens after soft factory data, retreats from high vs yen 
  > Gold climbs on weaker dollar, set to snap 5-day losing streak 
  > LME copper up, comes off 2-week low; demand worries hurt 
  > Oil gains $1 on U.S. equity rally 
    
    COMPANY NEWS
    
    ZURICH INSURANCE GROUP 
    Zurich Insurance Group missed expectations on Thursday with a 7
percent fall in first-quarter net profit and said it remained on track to meet
2013 targets.
    Europe's third-biggest insurer by market capitalisation posted a net profit
of $1.062 billion for the first three months of the year, missing analysts
average forecast in a Reuters poll for $1.137 billion. 
    For more, click on: 
        
    SOCIETE GENERALE 
    The chief executive of the bank's Russian unit, Vladimir Golubkov, and
another executive at Rosbank were charged on Thursday for taking bribes, the
Interior Ministry was quoted as saying. 
    
     BNP PARIBAS 
    France's No. 1 bank told shareholders it expects a "significant" drop in
staffing levels in its home market as it moves to offset the shrinking economy.
 
    
    VODAFONE 
    Vodafone said it agreed a deal with Germany's Deutsche Telekom 
that will allow the British company to offer its German customers TV over
superfast broadband. 
    
    ALCATEL-LUCENT 
    The online shopping sites Newegg and Overstock Inc won a patent
battle on Wednesday with the French telecom equipment maker Alcatel-Lucent,
which had accused the companies of infringing its patented technology.
 
    
     ROCHE 
     Swiss drugmaker Roche Holding AG is exploring a sale of its blood glucose
meters business, three people familiar with the matter told Reuters on
Wednesday, as the industry grapples with increased competition and reimbursement
pressure.
    
    ANTOFAGASTA 
    Chilean copper miner Antofagasta posted a 29 percent drop in first-quarter
core profit on Thursday, as lower prices for its red metal and slightly higher
operating costs offset increased production. 
    
    VEDANTA 
    India-focused miner Vedanta posted a 21 percent rise in core profit, boosted
by oil and gas assets that offset the impact of operational trouble elsewhere.
 
    
    BANCA POPOLARE DI MILANO 
    Moody's has downgraded Banca Popolare di Milano to Ba3 from Baa3; on review
for further downgrade.   
    
    TELECOM ITALIA 
    Generali CEO told Il Sole 24 Ore said he was in favour of any project that
creates value in Telecom Italia.
    
    MONTE DEI PASCHI 
    The banking foundation that controls Monte dei Paschi said on Wednesday it
approved its revised bylaws. The new rules will be sent to the treausury for
final approval.
    
    ROYAL BANK OF SCOTLAND 
    British Prime Minister David Cameron is "open to all ideas" for returning
Royal Bank of Scotland to private ownership but its finances must improve first,
he told reporters on the last day of a three-day visit to the United States.
 
    
    SUBSEA 7 
    Offshore engineering group Subsea 7 reported first-quarter earnings in line
with expectations and warned that it was facing a series of challenges from
delayed project awards to lower pricing. 
   Oslo-listed Subsea 7 said its first-quarter earnings before interest, taxes,
depreciation and amortisation rose 7 percent to $241 million, in line with
expectations for $241 million.
    
    ELECTROLUX 
    Deliveries of the six main white goods categories in the United States (AHAM
6) rose 9.2 percent year-on-year in April, figures from the Association of Home
Appliances Manufacturers showed late on Wednesday. Shipments are up in 6.5
percent over the first four months of the year.
    For more on the company, click on
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