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European Stocks Gain for Seventh Day; Morrison, Actelion Climb
European Stocks Gain for Seventh Day; Morrison, Actelion Climb
July 21 (Bloomberg) — European stocks advanced for a seventh day, the longest stretch of gains since August 2007, as companies from Caterpillar Inc. to DuPont Co. and UnitedHealth Group Inc. reported earnings that beat analysts’ estimates.
William Morrison Supermarkets Plc jumped 10 percent after saying earnings will beat its forecasts. Actelion Ltd., Switzerland’s biggest biotechnology company, added 3.9 percent after raising its sales and profit outlook for the year. Nokia Oyj slipped 2.9 percent after Morgan Stanley recommended selling shares of the world’s largest maker of mobile phones.
Europe’s Dow Jones Stoxx 600 Index rose 0.9 percent to 215.17 at 12:40 p.m. in London, heading for a close at the highest level since November. The measure has climbed 9.1 percent since July 10 as companies from Goldman Sachs Group Inc. to Johnson & Johnson posted better-than-estimated results and the Conference Board’s gauge of the U.S. economic outlook increased for a third straight month.
“Going forward, we should make gains,” said Jeremy Beckwith, who oversees $9.9 billion as chief investment officer at Kleinwort Benson in London. “Data is showing that later this year and next year economic growth is returning.”
Futures on the Standard & Poor’s 500 Index added 0.4 percent today as Caterpillar, the world’s biggest maker of construction equipment, reported second-quarter profit that beat analysts’ estimates and lifted its 2009 forecast.
DuPont Earnings
DuPont, the third-largest U.S. chemical maker, posted second-quarter profit that beat analysts’ estimates as the company eliminated jobs and sold more genetically modified crop seeds. UnitedHealth, the top U.S. insurer by sales, said second- quarter profit more than doubled, beating analysts’ estimates on higher premiums and growing Medicare enrollment.
Per-share earnings beat projections by an average of 14 percent for S&P 500 companies that have reported quarterly results since July 8, according to data compiled by Bloomberg. Analysts estimate profits for companies on the S&P 500 fell an average 33 percent in the second quarter and will decrease 20 percent from July through September.
The MSCI Asia Pacific Index advanced 1.4 percent after Australian Treasurer Wayne Swan said the global economy may have bottomed.
The S&P 500 yesterday climbed to its highest level since November, as a gauge of future economic growth topped projections and speculation grew that CIT Group Inc. will avoid bankruptcy. CIT announced an agreement with bondholders to provide the emergency financing late yesterday, keeping the 101- year-old commercial finance company out of bankruptcy.
Credit Suisse Strategy
Even so, CIT’s $3 billion financing pledge from bondholders may fail to shield the commercial lender from about $10 billion of debt maturing through next year, mounting loan defaults and a shrinking market share.
Credit Suisse Group AG switched its preference for government bonds in favor of stocks and raised its estimate for the S&P 500 by 14 percent to 1,050, citing improving economic indicators and earnings. Investors should increase holdings of global equities to “overweight” and reduce government bonds to “benchmark,” reversing a decision made in June, according to London-based global strategist Andrew Garthwaite.
Morrison soared 10 percent to 278.5 pence, the steepest intraday increase since February 2007. The smallest of the four main U.K. food retailers, said full-year results will be “ahead of its earlier expectations” after taking sales away from its larger competitors.
Actelion
Actelion advanced 3.9 percent to 59.75 Swiss francs. Switzerland’s largest biotechnology company said sales and cash earnings before interest and taxes in local currencies will rise 16 percent to 19 percent this year. Previously, Actelion had forecast a 12 percent to 15 percent increase in revenue and a 10 percent to 12 percent gain in earnings.
Nokia slid 2.9 percent to 9 euros. Morgan Stanley downgraded the shares to “underweight” from “overweight,” citing rising competition.
BASF SE, the world’s biggest chemical supplier, advanced 2.3 percent to 32.71 euros after boosting profit at its Indian subsidiary through cost cuts.
Norsk Hydro ASA rose 3.4 percent to 32.28 kroner. Europe’s third-largest aluminum producer was raised to “outperform” from “neutral” by Exane BNP Paribas.
Playtech Ltd., the U.K. developer of gambling software for PartyGaming Plc, plunged 22 percent to 354 pence after saying full-year trading would be below analyst estimates.
The William Hill Online joint venture with William Hill Plc took longer to start up than anticipated, Playtech said. William Hill, which said today that it is “comfortable” with the consensus of analysts’ estimates for the joint venture, lost 4.2 percent to 191.75 pence.
European stocks advanced for a seventh day, the longest stretch of gains since August 2007, as companies from Caterpillar Inc. to DuPont Co. and UnitedHealth Group Inc. reported earnings that beat analysts’ estimates.
William Morrison Supermarkets Plc jumped 10 percent after saying earnings will beat its forecasts. Actelion Ltd., Switzerland’s biggest biotechnology company, added 3.9 percent after raising its sales and profit outlook for the year. Nokia Oyj slipped 2.9 percent after Morgan Stanley recommended selling shares of the world’s largest maker of mobile phones.
Europe’s Dow Jones Stoxx 600 Index rose 0.9 percent to 215.17 at 12:40 p.m. in London, heading for a close at the highest level since November. The measure has climbed 9.1 percent since July 10 as companies from Goldman Sachs Group Inc. to Johnson & Johnson posted better-than-estimated results and the Conference Board’s gauge of the U.S. economic outlook increased for a third straight month.
“Going forward, we should make gains,” said Jeremy Beckwith, who oversees $9.9 billion as chief investment officer at Kleinwort Benson in London. “Data is showing that later this year and next year economic growth is returning.”
Futures on the Standard & Poor’s 500 Index added 0.4 percent today as Caterpillar, the world’s biggest maker of construction equipment, reported second-quarter profit that beat analysts’ estimates and lifted its 2009 forecast.
DuPont Earnings
DuPont, the third-largest U.S. chemical maker, posted second-quarter profit that beat analysts’ estimates as the company eliminated jobs and sold more genetically modified crop seeds. UnitedHealth, the top U.S. insurer by sales, said second- quarter profit more than doubled, beating analysts’ estimates on higher premiums and growing Medicare enrollment.
Per-share earnings beat projections by an average of 14 percent for S&P 500 companies that have reported quarterly results since July 8, according to data compiled by Bloomberg. Analysts estimate profits for companies on the S&P 500 fell an average 33 percent in the second quarter and will decrease 20 percent from July through September.
The MSCI Asia Pacific Index advanced 1.4 percent after Australian Treasurer Wayne Swan said the global economy may have bottomed.
The S&P 500 yesterday climbed to its highest level since November, as a gauge of future economic growth topped projections and speculation grew that CIT Group Inc. will avoid bankruptcy. CIT announced an agreement with bondholders to provide the emergency financing late yesterday, keeping the 101- year-old commercial finance company out of bankruptcy.
Credit Suisse Strategy
Even so, CIT’s $3 billion financing pledge from bondholders may fail to shield the commercial lender from about $10 billion of debt maturing through next year, mounting loan defaults and a shrinking market share.
Credit Suisse Group AG switched its preference for government bonds in favor of stocks and raised its estimate for the S&P 500 by 14 percent to 1,050, citing improving economic indicators and earnings. Investors should increase holdings of global equities to “overweight” and reduce government bonds to “benchmark,” reversing a decision made in June, according to London-based global strategist Andrew Garthwaite.
Morrison soared 10 percent to 278.5 pence, the steepest intraday increase since February 2007. The smallest of the four main U.K. food retailers, said full-year results will be “ahead of its earlier expectations” after taking sales away from its larger competitors.
Actelion
Actelion advanced 3.9 percent to 59.75 Swiss francs. Switzerland’s largest biotechnology company said sales and cash earnings before interest and taxes in local currencies will rise 16 percent to 19 percent this year. Previously, Actelion had forecast a 12 percent to 15 percent increase in revenue and a 10 percent to 12 percent gain in earnings.
Nokia slid 2.9 percent to 9 euros. Morgan Stanley downgraded the shares to “underweight” from “overweight,” citing rising competition.
BASF SE, the world’s biggest chemical supplier, advanced 2.3 percent to 32.71 euros after boosting profit at its Indian subsidiary through cost cuts.
Norsk Hydro ASA rose 3.4 percent to 32.28 kroner. Europe’s third-largest aluminum producer was raised to “outperform” from “neutral” by Exane BNP Paribas.
Playtech Ltd., the U.K. developer of gambling software for PartyGaming Plc, plunged 22 percent to 354 pence after saying full-year trading would be below analyst estimates.
The William Hill Online joint venture with William Hill Plc took longer to start up than anticipated, Playtech said. William Hill, which said today that it is “comfortable” with the consensus of analysts’ estimates for the joint venture, lost 4.2 percent to 191.75 pence.
(Bloomberg)
