PARIS (Thomson Financial) - Share prices were flat at lunchtime in hesitant trading ahead of this week's mass of first-half results, as negative sentiment after Friday's fall on Wall Street was offset by positive broker comments and takeover talk, including a report the French government is pushing for a tie-up between Alstom, Areva and Bouygues in the energy sector, according to market sources.
At 1.05 pm, the CAC-40 index was up 1.58 points or 0.03 pct at 5,958.74.
On the Matif, August CAC-40 futures were trading at 5,973.
The euro was at 1.3830 usd compared with 1.3797 usd late Friday.
One Paris dealer argued that a series of merger and acquisitions moves in Europe were helping the market hold up despite sharp Friday losses in the US, when the Dow Jones industrials slumped by nearly 150 points.
A major news focus in Paris was a report in German weekly Wirtschaftswoche which cited sources close to the company as saying that French president Sarkozy would like to buy out Siemens' stake in Areva NP, its nuclear power joint venture with Areva, to pave the way for a merger between Areva, Alstom and Bouygues.
Some kind of tie-up involving Areva, Alstom and Bouygues has been mooted for several months, supposedly backed by Sarkozy as a means of creating a French energy giant.
Siemens said today that it would like to retain its ownership in Areva NP, while an Areva spokesman said there is no plan for any change in Areva NP's capital structure.
An analyst at a major European broker said such a deal is now 'largely expected'. But given that Siemens AG is going to 'resist tooth and nail' to hold on to its position in nuclear power, he argued, 'it will come down to a political arrangement between France and Germany.'
Alstom shares were up 1.46 eur or 1.09 pct at 136.01, Bouygues added 0.54 or 0.88 pct to 61.69, and Areva was 12.85 or 0.96 pct higher at 814.85.
Still in the energy sector, EDF was also in focus after announcing Friday a nuclear-power joint venture with Constellation Energy Group Inc in the US.
The utility's shares were up 0.37 or 0.49 pct at 76.62, coming off an earlier fall, as investors saw the deal as positive but with little short-term financial impact.
Constellation and EDF's joint venture aims to develop and operate nuclear power plants in the US and Canada, based on Areva's advanced nuclear power plant design. EDF will invest 625 mln usd in the joint venture and may buy up to 9.9 pct of Constellation Energy's stock over the next five years.
A leading European broker argued that the investment is limited with regards to EDF's size but 'still material enough to show the group's commitment to expanding further in the USA'.
French broker CM-CIC was more enthusiastic, arguing in a note that the joint venture is a 'major announcement for EDF, which takes a giant step forward and thereby clarifies its development strategy'.
CM-CIC upgraded EDF to 'accumulate' versus 'hold' previously, with an increased target price of 85 eur.
In the car sector, Peugeot rose 0.67 or 1.05 pct to 64.63 on the back of Exane BNP Paribas' decision to lift its price target to 73 eur from 58.
The broker, which maintained its 'outperform' rating, said Peugeot's plans to boost operating profit should deliver the same results as those implemented by rival car makers Renault -- down 0.50 or 0.45 pct at 111.68 -- and Fiat.
Both Renault and Peugeot will report first-half results on Wednesday.
Other risers included Lafarge -- up 1.75 or 1.38 pct at 128.50 -- and Vinci -- up 0.37 or 0.66 pct at 56.14 -- with the two construction groups recovering from Friday's losses prompted by fears over the housing market.
Separately, Credit Agricole's insurance subsidiary Predica holds a 2.3 pct stake in Vinci's capital, taking the banking group's overall holding to 2.52 pct, French daily Les Echos reported, citing comments from a Predica spokesperson.
On the downside, banking stocks continued to suffer from worries about suprime mortgages. Dexia was down 0.29 or 1.23 pct at 23.37, Societe Generale off 1.13 or 0.83 pct at 134.41, Credit Agricole 0.13 or 0.44 pct lower at 29.32, and BNP Paribas was falling 0.43 or 0.51 pct at 83.81.
Dexia was also the object of market rumours that it will launch a counter-bid for German public finance group Depfa Bank plc following Hypo Real Estate's 5.7 bln eur offer.
Earlier this month it had been rumoured that Dexia would make an offer for the group, though analysts later said there would not be enough overlap between the two.
Vallourec was the biggest faller on the CAC-40, shedding 5.12 or 2.37 pct to 211.06 to extend its sharp drop Friday, when its announcement of the sale of two French units to ArcelorMittal -- up 0.49 or 1.03 pct to 48.05 -- served to cool speculation that Arcelor Mittal may make a bid for the whole of Vallourec.
Sanofi-Aventis, meanwhile, gave up 0.36 or 0.58 pct to 62.10. The European Medicines Agency (EMEA) said that, following a review, of Sanofi-Aventis SA's drug veralipride -- used to treat hot flushes in menopausal women -- should be withdrawn from sale throughout Europe due to side-effects including depression, dyskenisia and sleep disorders.
Contacted by Thomson Financial a spokesperson for Sanofi-Aventis said 'Agreal only generates limited sales', while stressing that more modern therapeutic alternatives have emerged since Agreal was launched over 20 years ago. tfn.paris@thomson.com gt/rfw 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 1.05 pm, the CAC-40 index was up 1.58 points or 0.03 pct at 5,958.74.
On the Matif, August CAC-40 futures were trading at 5,973.
The euro was at 1.3830 usd compared with 1.3797 usd late Friday.
One Paris dealer argued that a series of merger and acquisitions moves in Europe were helping the market hold up despite sharp Friday losses in the US, when the Dow Jones industrials slumped by nearly 150 points.
A major news focus in Paris was a report in German weekly Wirtschaftswoche which cited sources close to the company as saying that French president Sarkozy would like to buy out Siemens' stake in Areva NP, its nuclear power joint venture with Areva, to pave the way for a merger between Areva, Alstom and Bouygues.
Some kind of tie-up involving Areva, Alstom and Bouygues has been mooted for several months, supposedly backed by Sarkozy as a means of creating a French energy giant.
Siemens said today that it would like to retain its ownership in Areva NP, while an Areva spokesman said there is no plan for any change in Areva NP's capital structure.
An analyst at a major European broker said such a deal is now 'largely expected'. But given that Siemens AG is going to 'resist tooth and nail' to hold on to its position in nuclear power, he argued, 'it will come down to a political arrangement between France and Germany.'
Alstom shares were up 1.46 eur or 1.09 pct at 136.01, Bouygues added 0.54 or 0.88 pct to 61.69, and Areva was 12.85 or 0.96 pct higher at 814.85.
Still in the energy sector, EDF was also in focus after announcing Friday a nuclear-power joint venture with Constellation Energy Group Inc in the US.
The utility's shares were up 0.37 or 0.49 pct at 76.62, coming off an earlier fall, as investors saw the deal as positive but with little short-term financial impact.
Constellation and EDF's joint venture aims to develop and operate nuclear power plants in the US and Canada, based on Areva's advanced nuclear power plant design. EDF will invest 625 mln usd in the joint venture and may buy up to 9.9 pct of Constellation Energy's stock over the next five years.
A leading European broker argued that the investment is limited with regards to EDF's size but 'still material enough to show the group's commitment to expanding further in the USA'.
French broker CM-CIC was more enthusiastic, arguing in a note that the joint venture is a 'major announcement for EDF, which takes a giant step forward and thereby clarifies its development strategy'.
CM-CIC upgraded EDF to 'accumulate' versus 'hold' previously, with an increased target price of 85 eur.
In the car sector, Peugeot rose 0.67 or 1.05 pct to 64.63 on the back of Exane BNP Paribas' decision to lift its price target to 73 eur from 58.
The broker, which maintained its 'outperform' rating, said Peugeot's plans to boost operating profit should deliver the same results as those implemented by rival car makers Renault -- down 0.50 or 0.45 pct at 111.68 -- and Fiat.
Both Renault and Peugeot will report first-half results on Wednesday.
Other risers included Lafarge -- up 1.75 or 1.38 pct at 128.50 -- and Vinci -- up 0.37 or 0.66 pct at 56.14 -- with the two construction groups recovering from Friday's losses prompted by fears over the housing market.
Separately, Credit Agricole's insurance subsidiary Predica holds a 2.3 pct stake in Vinci's capital, taking the banking group's overall holding to 2.52 pct, French daily Les Echos reported, citing comments from a Predica spokesperson.
On the downside, banking stocks continued to suffer from worries about suprime mortgages. Dexia was down 0.29 or 1.23 pct at 23.37, Societe Generale off 1.13 or 0.83 pct at 134.41, Credit Agricole 0.13 or 0.44 pct lower at 29.32, and BNP Paribas was falling 0.43 or 0.51 pct at 83.81.
Dexia was also the object of market rumours that it will launch a counter-bid for German public finance group Depfa Bank plc following Hypo Real Estate's 5.7 bln eur offer.
Earlier this month it had been rumoured that Dexia would make an offer for the group, though analysts later said there would not be enough overlap between the two.
Vallourec was the biggest faller on the CAC-40, shedding 5.12 or 2.37 pct to 211.06 to extend its sharp drop Friday, when its announcement of the sale of two French units to ArcelorMittal -- up 0.49 or 1.03 pct to 48.05 -- served to cool speculation that Arcelor Mittal may make a bid for the whole of Vallourec.
Sanofi-Aventis, meanwhile, gave up 0.36 or 0.58 pct to 62.10. The European Medicines Agency (EMEA) said that, following a review, of Sanofi-Aventis SA's drug veralipride -- used to treat hot flushes in menopausal women -- should be withdrawn from sale throughout Europe due to side-effects including depression, dyskenisia and sleep disorders.
Contacted by Thomson Financial a spokesperson for Sanofi-Aventis said 'Agreal only generates limited sales', while stressing that more modern therapeutic alternatives have emerged since Agreal was launched over 20 years ago. tfn.paris@thomson.com gt/rfw 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
