UPDATE 1-European Factors to Watch-Stocks to fall on prospect of early Fed taper
LONDON Dec 12 (Reuters) - European stocks are set to open lower on Thursday, with the probable nomination of a relatively hawkish central banker to the U.S. Federal Reserve vice-chair adding to the view that the U.S. may slow its monetary stimulus sooner than previously thought.
Former Bank of Israel governor Stanley Fischer has been asked to be the Federal Reserve's next vice chair, a source familiar with the issue said on Wednesday, and is seen as less dovish than the nominee for chair of the bank, Janet Yellen.
In particular, he is not an advocate of extending the Fed's "forward guidance" that interest rates could be lower for even longer than previously expected. The Fed holds a policy meeting next week.
"Reports that Stanley Fischer potentially being nominated for the Vice-chair of the Fed could (also) be having an impact, given he has said before that he opposes adjusting the Fed's forward guidance," Chris Weston, chief market strategist at IG, said in a note.
The news came late on a day where U.S. stocks posted their largest drop in a month on Wednesday after a provisional budget deal out of Washington removed one near-term reason for the Fed to keep up its current pace of economic stimulus. Asian shares also suffered on these "tapering" concerns.
While European shares opened on Wednesday stronger after the budget deal, they gave away those gains by the end of the day, as the removal of uncertainty over fiscal policy was counteracted by this view of a potentially tighter monetary outlook.
The FTSEurofirst 300 was down 0.5 percent at 1,256.32 points at the close after Wall Street opened lower, and the U.S. extended losses after the market close in Europe.
"European markets should find reasonable selling as they price in a U.S. market that closed on its low," IG's Weston said.
At 0720 GMT, futures for the Euro STOXX 50, Britain's FTSE 100 , Germany's DAX and France's CAC were 0.3 percent - 0.5 percent lower.
U.S. retail sales and initial jobless claims data will be in focus on Thursday, with traders saying a set of strong numbers could harden the view that the Fed could begin a taper of its asset purchases - known as quantitative easing (QE) - as early as its policy meeting next week.
"The jury is still out as to whether the announcement to start the tapering of QE will be made then, but arguably it's the uncertainty that's eating into markets right now," Patrick Latchford at Monex Capital Markets said.
"There are also suggestions that agreement on Capitol Hill over the Federal Budget... is adding weight to the argument for swift action."
-------------------------------------------------------------------------------- > Asian shares ease to 2-1/2 month low on Fed tapering anxiety > Fed taper anxiety triggers profit taking on Wall St > Nikkei falls 1.4 pct as index heavyweights drag on Fed concern > TREASURIES-Prices fall ahead of 30-year bond supply > Yen's respite proves short-lived with Fed in focus > Gold ticks up on weaker equities; technical support helps > Copper eases from 1-mth high; tight physical supply supports > Brent edges down towards $109 on tapering concerns
German retailer Metro said it aimed for a significant improvement in profitability for 2013/14 as a restructuring plan starts to deliver after meeting its own guidance for operating earnings for the first nine months of 2013.
British energy services company Wood Group said on Thursday it expected to meet forecasts for 2013 growth, but warned that profits from its engineering division would be down by between 10 and 15 percent next year due to continuing weakness in Canada.
Britain's biggest sporting goods retailer Sports Direct posted a strong rise in first-half profit and said it remained on the hunt for further expansion opportunities in Europe.
Goldman Sachs and Deutsche Bank bought big stakes in Portugal's CTT , the newly privatised postal services company said on Wednesday, as its shareholder structure began to be disclosed.
Separately, European Union negotiators have agreed that bondholders and large depositors in a failing bank face taking losses from the start of 2016, a European Parliament lawmaker said on Wednesday.
Former BMW Chief Executive Bernd Pischetsrieder, former Bosch manager Bernd Bohr and Siemens CEO Joe Kaeser will be named to Daimler's supervisory board, German daily Handelsblatt reported.
The group is in talks over getting the "DE-mail" certification, the standard using encryption for sending emails that require a high level of security, in Germany. Deutsche Post had said in April it wouldn't join the scheme.
Private equity firms Hellman & Friedman LLC and JMI Equity are exploring a sale of human resources management software firm Kronos Inc, which could be valued at more than $4 billion, people familiar with the matter said on Wednesday. Oracle Corp and SAP would be natural buyers for Kronos but have so far shown little interest, the people added.
The carmaker is considering building a new factory in Poland to assemble the Crafter large delivery van, two people familiar with the matter said on Wednesday.
Separately, VW said it was hiring Italian engineering graduates as it expands its recruitment efforts in southern Europe to counter a skills shortage at home.
PSA PEUGEOT CITROEN
Peugeot's board agreed to enter final negotiations on a 3.5-billion-euro ($4.8 billion) share issue that would see France and Dongfeng Motor take matching 20 percent stakes at a 40 percent discount to Peugeot's current share price, a source familiar with the matter said.
PSA Peugeot Citroen is weighing new commercial and industrial projects with partners including China's Dongfeng Motor Group, backed by a capital increase, the French carmaker said on Thursday.
Air Canada is in advanced talks to buy or place options for more than 100 Boeing 737 MAX aircraft, a source familiar with the matter said.
Meanwhile, Air Caraibes announced plans for a $1 billion order for three A350-1000 passenger jets and said it would lease a further three smaller A350s in the largest fleet acquisition in its 10-year history.
The aerospace group said it planned to pay shareholders an interim dividend of 0.48 euros per share for 2013 on Dec 19, a payout amounting to about 200 million euros.
The world's largest steelmaker said it was reorganising itself to manage the business according to regions, while maintaining product specialisation within those regions. Michel Wurth, in charge of Long Carbon Worldwide, has notified his intention to retire in April 2014.
The state-controlled Finnish utility said it agreed to sell its power grid in Finland to the Suomi Power Networks consortium, led by the infrastructure funds First State and Borealis, for 2.55 billion euros ($3.52 billion).
The telecom operator is open to acquisitions in its main markets, daily Dagens Industri wrote.
"If opportunities present themselves within our framework in the Eurasia, Baltic and Nordic regions for that (acquisition), then we will assess them," CEO Johan Dennelind said.
Dennelind said he expected operator consolidation in Europe to continue.
He also said that Telia would adopt tougher rules to protect customers from network surveillance by state security services.
The Swiss travel retailer said it was buying the 49 percent stake in Hellenic Duty Free it does not already own from Greek rival Folli Follie for 328 million euros ($452 million), a vote of confidence in the austerity-hit economy.
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