STOCKS NEWS EUROPE-DSG higher; Nomura ups to "buy"

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09:39GMT 10Dec2008-DSG higher; Nomura ups to "buy"

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Shares in electricals retailer DSG International (DSGI.L) gain 9.8 percent to 14 pence as Nomura raises its rating to "buy" albeit with a lowered 38 pence price target reflecting cuts to estimates.

The broker says the retailer which owns Currys and PC World is "priced to fail", but it believes the probability of this is over-stated, and sees significant upside potential for the share price.

Nomura says DSG has a number of strategic options, including disposals which could help to raise cash, pay down debt and increase headroom versus covenants.

The broker thinks this will see DSG trade through the cycle and allow it to execute its transformation plan, which will be key as the market continues to deteriorate.

Nomura says failure to execute this plan effectively could see further downside risk but it believes DSG management is well positioned to see the retailer through the cycle.

Reuters Messaging rm://jon.hopkins.reuters.com@reuters.net

09:39GMT 10Dec2008-Porvair gains after trading update

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Shares in Porvair (PORV.L) gain 2.8 percent after the filtration and environmental technologies group says it trades well in 2008 and will report double digit organic growth in both sales and profits, in line with management's expectations.

"We believe 2008 has been a successful year for Porvair," says Altium Securities in a note.

The broker says it is making slight changes to sales and net debt forecasts to accommodate changes in the exchange rate, but reaffirms its pretax profit/EPS forecasts for 2008 and 2009.

"Looking into 2009, there are areas of risk - but also some opportunities," says the broker, keeping its "buy" recommendation.