Tuesday, 24 September 2013

Europe Stocks Pare Gains on U.S. Consumer-Confidence Data

By Namitha Jagadeesh - Sep 24, 2013 6:20 PM GMT+0400
European stocks erased their advance, following a two-day decline, as reports on consumer confidence and regional manufacturing in the U.S. trailed economists’ estimates.
Nokia Oyj advanced 1.6 percent after a U.S. judge found that HTC Corp. violated two of its patents. Total SA climbed 2.8 percent after Barclays Plc raised its rating on the oil producer. Burckhardt Compression Holding AG slid the most in two years after saying fiscal first-half net income will decline from the year-earlier period.
Sept. 24 (Bloomberg) -- Jeffrey Rosenberg, chief investment strategist for fixed income at BlackRock Inc., talks about market outlook and Federal Reserve policy. Rosenberg speaks with Tom Keene, Sara Eisen and Scarlet Fu on Bloomberg Television's "Surveillance." (Source: Bloomberg)
The Stoxx Europe 600 Index slipped less than 0.1 percent to 312.51 at 3:17 p.m. in London, erasing a gain of as much as 0.3 percent. The equity benchmark has still climbed 5.1 percent in September, extending its rally this year to 12 percent, as the Fed refrained from reducing its monthly bond buying. The gauge has risen 9.6 percent in the current quarter, on course for its biggest gain in four years. It is trading at 14.3 times projected earnings, compared with a high of 15.7 times in October 2009.
“In the medium to long term, European equities still look attractive,” Herbert Perus, who helps oversee about $36 billion as head of equities at Raiffeisen Capital Management in Vienna, said by phone. “Valuations are still cheap and more investors will buy European stocks. In the very short term, the rally we saw over the last few weeks may come off a bit. If we get a clear statement from the Fed, that would help markets.”

Economic Reports

In the U.S., the Conference Board’s consumer-confidence index slipped to 79.7 this month from a revised 81.8 in August. The median forecast of economists surveyed by Bloomberg had called for a reading of 79.9.
A measure of manufacturing in the region covered by the Fed Bank of Richmond shrank in September. The factory index, which covers North Carolina, South Carolina, the District of Columbia, Maryland, Virginia and most of West Virginia, dropped to 0 from 14 last month. Economists in a Bloomberg survey had predicted the gauge would decline to 12.
In Germany, the Ifo institute’s business-climate index, based on a survey of 7,000 executives, advanced to 107.7 from a revised 107.6 in August. That missed the median economist forecast in a Bloomberg News survey of 108.
National benchmark indexes advanced in 15 out of 18 western-European markets. The U.K.’s FTSE 100 increased 0.1 percent and Germany’s DAX added 0.2 percent, while France’s CAC 40 climbed 0.4 percent.

Patent Infringement

Nokia, the Finnish phonemaker that has agreed to sell its handsets business to Microsoft Corp., climbed 1.6 percent to 4.88 euros. HTC infringed on two patent rights held by Nokia, U.S. International Trade Commission Judge Thomas Pender said in a notice yesterday. A six-member commission will review the judge’s findings before deciding whether to block any imports.
Total added 2.8 percent to 43.29 euros after Barclays raised its recommendation on the stock to equal weight, which is similar to hold, from underweight. The brokerage said Europe’s third-biggest oil company can better control its capital expenditure than it had predicted. Total gave detailed capital-spending plans for exploration and production at its investor day, according to Barclays.
Close Brothers Group Plc gained 4.2 percent to 1,180 pence as the British financial services company said full-year net income rose 20 percent to 119.4 million pounds ($191 million). Its asset-management unit swung to a profit of 4 million pounds from a 4.3 million-pound loss a year earlier.

Telecom Italia

Telecom Italia SpA climbed 3.4 percent to 61 euro cents. Telefonica SA agreed to pay 324 million euros ($437 million) to increase its stake in Telco SpA, a holding company that owns 22.4 percent of Telecom Italia, to 66 percent from 46 percent.
Burckhardt tumbled 7 percent to 359.50 Swiss francs after saying that lower-than-expected gross margins on two major compressor-system projects will lead the company to make provisions in the six months through September.
Deutsche Wohnen AG slipped 2.4 percent to 13.23 euros as a statement showed Blackstone Group LP is selling 8.15 million shares, or a 4.8 percent stake, in the German residential landlord. The price guidance has narrowed to 13.05 euros to 13.10 euros a share, people familiar with the matter said.
Suedzucker AG dropped 3.2 percent to 21.10 euros. The maker of sugar and starch said it might miss its May forecast of 825 million euros for full-year operating profit following its CropEnergies unit’s purchase of bioethanol producer Ensus Ltd. in July.
“It is more challenging to achieve this target due to the current cautious business development and effects from the integration of Ensus at CropEnergies,” it said in a statement.
The volume of shares changing hands in companies listed on the Stoxx 600 was 9.6 percent greater than the average of the past 30 days, according to data compiled by Bloomberg.
To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net