PARIS (Thomson Financial) - Share prices were slightly down at midday as investors continued to consolidate gains after last week's highs and on the eve of the European Central Bank's interest rate meeting, while Renault led the CAC-40 as its new-product offensive attracted another positive broker note, dealers said.
At 1.13 pm, the CAC-40 index was down 13.11 points or 0.21 pct at 6,112.70, on volume of 2.3 bln eur.
On the Matif, June CAC-40 futures were trading down 3.5 or 0.06 pct at 6,104.0.
The euro was at 1.3516 usd, against 1.3487 late yesterday.
The European Central Bank (ECB) is virtually certain to raise its main refinancing rate to 4 pct from 3.75 pct at its governing council meeting tomorrow, but the markets will be looking above all for signals on the prospects for further rate hikes.
The key question concerns the phrase that the ECB will use to describe its monetary policy stance, which since the last rate hike in March it has described as 'on the accommodative side'.
Amid the generally downbeat trading this morning, Renault led bluechip gains by adding 2.31 eur or 2.05 pct at 114.95, helped by Deutsche Bank's decision to raise its target price to 144 eur from 117 with a renewed 'buy' rating.
The broker cited the car maker's strong product offensive as well as anticipated reductions in costs, adding that the share price may hit the 160 mark in the next two years.
Yesterday, fellow broker Societe Generale Securities upgraded its recommendation on Renault to 'buy' from 'hold' and hiked its target price to 130 eur from 90 eur, also citing the launch of new models in Europe.
Peugeot was boosted by the optimism surrounding Renault, rising 0.39 or 0.66 pct to 59.92.
Air Liquide climbed 2.32 or 1.28 pct to 183.30 as rumours circulated the chemicals firm might be the target of a leveraged buyout.
'The rumour's coming out of Geneva, and we're hearing it's Wendel Investissement because it's placing Bureau Veritas in the market,' a Paris-based dealer said.
But dealers didn't lend much weight to the rumour.
Another strong gainer on the CAC-40 was Bouygues, up 1.14 or 1.75 pct at 66.26.
There were fresh speculation the conglomerate could sell its stake in TF1 in order to fund a potential acquisition of nuclear power group Areva.
Bouygues issued a denial regarding the rumour.
A London-based analyst, meanwhile, doubted that Bouygues would choose to sacrifice TF1 stake for this purpose, arguing that 'TF1 is a really good asset for Bouygues and there are other ways they can raise the necessary cash'.
Investors will be looking for indications of Bouygues' strategy when the group reports first-quarter results tomorrow morning.
Separately, the company's Colas Group unit said it won contract worth 100 mln eur to build access roads and earthworks for a nickel and cobalt mining project in Madagascar.
Areva, meanwhile, added 15.94 or 2.07 pct to 787.83 amid the Bouygues speculation plus expectations of opportunities in Australia after prime minister John Howard pledged to consider introducing nuclear power stations.
Alstom was another climber, up 1.60 or 1.35 pct at 120.50. The engineering group announced yesterday a 580 mln eur contract from electric utility E.On to build a power plant in Isle of Grain, Kent, UK, plus a 12-year service contract whose value was not disclosed.
Alstom has also been cited in the ongoing speculation around Areva, especially given that Bouygues holds a 25 stake in the group. On the downside, Lagardere fell 0.89 or 1.44 pct to 61.05.
Employees at its Hachette Filipacchi Media and Europe 1 units decided yesterday to call off strike action planned for today after management agreed to review the terms of the restructuring plan.
Gaz de France shed 0.35 or 0.95 pct to 36.57 amid continuing uncertainty over the likelihood its merger with Suez will go ahead.
Suez, which has been linked with other potential deals, inched down 0.06 or 0.14 pct to 42.10.
Danone slipped 0.63 or 1.07 pct to 58.06 as the food manufacturer pursued legal action against Chinese partner Wahaha.
Danone said it has filed a suit against Wahaha at the Supreme Court of California, alleging illegal competition.
The French group added that it is suing in the US in order to prevent the Chinese companies concerned collusively dampening the joint venture's customer relationships and business outlook.
Air France-KLM fell 0.80 or 2.09 pct to 37.46, giving up a little of its gains since reporting strong results and outlook last month.
tfn.paris@thomson.com gt/am COPYRIGHT Copyright AFX News Limited 2007. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
At 1.13 pm, the CAC-40 index was down 13.11 points or 0.21 pct at 6,112.70, on volume of 2.3 bln eur.
On the Matif, June CAC-40 futures were trading down 3.5 or 0.06 pct at 6,104.0.
The euro was at 1.3516 usd, against 1.3487 late yesterday.
The European Central Bank (ECB) is virtually certain to raise its main refinancing rate to 4 pct from 3.75 pct at its governing council meeting tomorrow, but the markets will be looking above all for signals on the prospects for further rate hikes.
The key question concerns the phrase that the ECB will use to describe its monetary policy stance, which since the last rate hike in March it has described as 'on the accommodative side'.
Amid the generally downbeat trading this morning, Renault led bluechip gains by adding 2.31 eur or 2.05 pct at 114.95, helped by Deutsche Bank's decision to raise its target price to 144 eur from 117 with a renewed 'buy' rating.
The broker cited the car maker's strong product offensive as well as anticipated reductions in costs, adding that the share price may hit the 160 mark in the next two years.
Yesterday, fellow broker Societe Generale Securities upgraded its recommendation on Renault to 'buy' from 'hold' and hiked its target price to 130 eur from 90 eur, also citing the launch of new models in Europe.
Peugeot was boosted by the optimism surrounding Renault, rising 0.39 or 0.66 pct to 59.92.
Air Liquide climbed 2.32 or 1.28 pct to 183.30 as rumours circulated the chemicals firm might be the target of a leveraged buyout.
'The rumour's coming out of Geneva, and we're hearing it's Wendel Investissement because it's placing Bureau Veritas in the market,' a Paris-based dealer said.
But dealers didn't lend much weight to the rumour.
Another strong gainer on the CAC-40 was Bouygues, up 1.14 or 1.75 pct at 66.26.
There were fresh speculation the conglomerate could sell its stake in TF1 in order to fund a potential acquisition of nuclear power group Areva.
Bouygues issued a denial regarding the rumour.
A London-based analyst, meanwhile, doubted that Bouygues would choose to sacrifice TF1 stake for this purpose, arguing that 'TF1 is a really good asset for Bouygues and there are other ways they can raise the necessary cash'.
Investors will be looking for indications of Bouygues' strategy when the group reports first-quarter results tomorrow morning.
Separately, the company's Colas Group unit said it won contract worth 100 mln eur to build access roads and earthworks for a nickel and cobalt mining project in Madagascar.
Areva, meanwhile, added 15.94 or 2.07 pct to 787.83 amid the Bouygues speculation plus expectations of opportunities in Australia after prime minister John Howard pledged to consider introducing nuclear power stations.
Alstom was another climber, up 1.60 or 1.35 pct at 120.50. The engineering group announced yesterday a 580 mln eur contract from electric utility E.On to build a power plant in Isle of Grain, Kent, UK, plus a 12-year service contract whose value was not disclosed.
Alstom has also been cited in the ongoing speculation around Areva, especially given that Bouygues holds a 25 stake in the group. On the downside, Lagardere fell 0.89 or 1.44 pct to 61.05.
Employees at its Hachette Filipacchi Media and Europe 1 units decided yesterday to call off strike action planned for today after management agreed to review the terms of the restructuring plan.
Gaz de France shed 0.35 or 0.95 pct to 36.57 amid continuing uncertainty over the likelihood its merger with Suez will go ahead.
Suez, which has been linked with other potential deals, inched down 0.06 or 0.14 pct to 42.10.
Danone slipped 0.63 or 1.07 pct to 58.06 as the food manufacturer pursued legal action against Chinese partner Wahaha.
Danone said it has filed a suit against Wahaha at the Supreme Court of California, alleging illegal competition.
The French group added that it is suing in the US in order to prevent the Chinese companies concerned collusively dampening the joint venture's customer relationships and business outlook.
Air France-KLM fell 0.80 or 2.09 pct to 37.46, giving up a little of its gains since reporting strong results and outlook last month.
tfn.paris@thomson.com gt/am COPYRIGHT Copyright AFX News Limited 2007. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
© 2007 AFX News
