Europe Factors to Watch-Shares set to pause; mood still bullish

Tue Feb 25, 2014 2:34am EST

PARIS, Feb 25 (Reuters) - European stocks were seen mixed on Tuesday, taking
a breather after a sharp three-week rally, although the overall mood remained
bullish with further positive corporate results and a number of U.S. and
European equity indexes reaching key levels.
    BASF, the world's largest chemicals company by sales, exceeded
expectations for quarterly earnings, helped by higher margins at its oil and gas
as well as its precursor chemicals divisions. 
    French media-and-telecoms company Vivendi reported a tenfold jump
in net profit for 2013 on the back of asset sales and said results had met its
guidance, as it prepares to spin off domestic mobile brand SFR. 
    At 0728 GMT, futures for the Euro STOXX 50 were down 0.2 percent.
Futures for Britain's FTSE 100 were also down 0.1 percent, while futures
for Germany's DAX rose 0.2 percent and those for France's CAC 
fell 0.2 percent.
    European stocks have been rallying strongly in the past three weeks, with
the FTSEurofirst 300 index of top European shares surging 7 percent,
supported by a positive earnings season as well a recovery in euro zone macro
economic data.
    About 60 percent of companies have reported results so far in the European
earnings season, and 58 percent of them have met or beaten earnings forecast,
with quarterly profits up 1.5 percent year-over-year and revenues up 1.7
percent, Thomson Reuters StarMine data shows.
    The rally has propelled a number of indexes to key levels, with France's CAC
40 hitting a 5-1/2 year high and the FTSE 100 on Monday closing
just 1.2 percent shy of its record high hit in December 1999, while on Wall
Street, the S&P 500 hit a record intraday high. 
    On the short-term, however, technical charts show indexes reaching
'overbought' levels, which could prompt investors to book a bit of profits.
    "The long-term trend is still bullish: shallow dips and strong rebounds,
which are boosted in part by short covering and by further buying from investors
who are not 'long' enough," Aurel BGC chartist Gerard Sagnier said.
    Europe bourses in 2014:Asset performance in 2014:------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0725 GMT
                                        LAST         PCT CHG    NET CHG
 S&P 500                                1,847.61     0.62 %     11.36
 NIKKEI                                 15,051.60    1.44 %     213.92
 MSCI ASIA EX-JP                        458.56       0.05 %     0.23
 EUR/USD                                1.374        0.04 %     0.0006
 USD/JPY                                102.27       -0.2 %     -0.2000
 10-YR US TSY YLD                       2.734        --         -0.02
 10-YR BUND YLD                         1.680        --         0.00
 SPOT GOLD                              $1,334.50    -0.16 %    -$2.10
 US CRUDE                               $102.28      -0.53 %    -0.54
  > GLOBAL MARKETS-Stocks bounce as merger frenzy spurs Wall St 
  > US STOCKS-S&P 500 ends less than 1 point below record closing high 
  > Tokyo's Nikkei share average closes up 1.44 pct 
  > FOREX-Dollar steadies ahead of US data, Asia eyes yuan weakness 
  > PRECIOUS-Gold holds near 4-mth high on China growth, Ukraine worries 
  > METALS-LME copper rebounds from more than 2-wk low on growth hopes 
  > Brent weak as US crude stocks seen rising, holds above $110 on Libya 
    
    COMPANY NEWS:    
    BASF 
    The world's largest chemicals company by sales exceeded expectations for
quarterly earnings, helped by higher margins at its oil and gas as well as its
precursor chemicals divisions. 
    
    VIVENDI 
    The French media-and-telecoms company reported a tenfold jump in net profit
for 2013 on the back of asset sales and said results had met its guidance as it
prepares to spin off domestic mobile brand SFR. 
    
    UBS 
    Swiss bank UBS is prepared to pay a fine of up to 200 million euros ($274.5
million) in an investigation of alleged tax avoidance by the lender's German
clients, a German newspaper reported on Tuesday. 
    
    GKN 
    The British car and plane parts maker reported a 17 percent rise in annual
profit, beating analyst expectations, as strong demand in its automotive unit
offset sluggish growth in military markets. 
    
    CRODA INTERNATIONAL 
    The British specialty chemical maker said it expects currency translation to
have an adverse impact on profit growth in 2014. 
    
    FRESENIUS MEDICAL CARE 
    The world's largest dialysis provider said it expects its net profit to
shrink further this year after posting its first decline in twelve years for
2013 amid cuts to U.S. healthcare budgets. 
    
    FRESENIUS SE 
    The German diversified healthcare group announced plans to increase its
dividend for 2013 after posting a 12 percent increase in 2013 net profit.
 
    
    BANCA CARIGE 
    The top investor in Banca Carige said on Monday it would ask the lender's
shareholders for a delay in a capital increase planned at the mid-sized lender.
 
    
    MONCLER 
    Italian quilted jacket maker Moncler said on Monday sales and profit grew at
double-digit rates in 2013, supporting the growth prospects which drew strong
demand for its December listing. 
    
    DEUTSCHE BANK 
    Deutsche Bank agreed to pay $20 million to settle charges in Brazil that
Europe's largest investment bank by revenue helped manage funds embezzled by
former city of São Paulo officials in the 1990s, a prosecutor said on Monday.
 
    
    AIRBUS GROUP 
    The Pentagon said on Monday it would shrink the U.S. Army to pre-World War
Two levels, eliminate the popular A-10 aircraft and reduce military benefits in
order to meet 2015 spending caps. 
    
    SAFT 
    The battery maker has won a multi-million-dollar contract from partner
Lockheed Martin to provide lithium-ion batteries for communication
satellites to be used by the U.S. Air Force Space Command.
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