LONDON (Thomson Financial) - Europe's leading exchanges were largely lower in midday trading, hovering around the flatline throughout the morning, with M&A activity in the staffing, entertainment and financial sectors grabbing the spotlight.
At 12.11 pm, the Dow Jones STOXX 50 was down 8.45 points or 0.23 pct at 3,744.22, while the STOXX 600 shed 0.17 points or 0.05 pct to 370.19.
Looking ahead, Wall Street is headed for a flat to slightly higher open, helped by a fresh drop in the price of oil which eased inflation fears.
According to spread bettors IG Index, the Dow Jones Industrial Average is expected to open up 17 points at 13,389. Separately, S&P 500 futures ticked up 0.30 point to 1,484, while Nasdaq 100 futures gained 0.75 point to 2,095.25.
In Europe, M&A news was in focus throughout the day, continuing the trend that started last month in the mining sector.
According to research by Thomson Financial, European target M&A activity soared in November to reach the highest monthly level of 2007.
The Dutch staffing sector remained in the spotlight today as the financial details regarding the takeover bid from Randstad for Vedior were announced, sending Vedior on an 8.82 pct rally. Randstad, down 9.74 pct, will offer Vedior shareholders 9.50 eur in cash and 32.759 pct of a share per Vedior share. The group also said it will issue 57 mln new shares to help finance the deal.
Over in France, Vivendi is currently trading 2.55 pct higher, after the group said Sunday that it agreed to acquire a 52 pct majority stake in Activision in exchange for its Vivendi Games games unit and 1.7 bln usd in cash, in a deal valued at a total of 18.9 bln usd.
Analysts at Natixis Securities see strong synergies between the two groups, with one a leader in online games and the other strongly positioned in console games.
'This is an attractive deal strategically and should be well-perceived. A little expensive, but then again they're not using much cash,' a Paris-based trader said.
In the German market, TUI is in focus after stating that it is examining several options including possible mergers for its Tuifly unit. Shares were 0.63 pct higher at last check.
Adidas -- up 1.45 pct -- entered the stage earlier when rumours circulated that Asics and Nike are mulling a joint bid at 65 eur a share. Traders were dismissive, pointing to Asics' small market cap.
Meanwhile, the announcement by Swiss Life that it will make a 30 eur per share agreed takeover offer for German independent financial advisor AWD led to a 30 pct surge in the latter. Swiss Life lost 5.66 pct.
Dealers noted that a takeover battle is unlikely, but highlighted the effect on other stocks in the sector, such as MLP AG or OVB Holding, which are currently rallying 14.37 pct and 5.41 pct respectively.
Staying among financials, Northern Rock shed 4.66 pct, with investors mulling over reports that both JC Flowers and Deutsche Bank have threatened to walk away from the negotiations. Deutsche Bank later denied a report in the Sunday Telegraph and said it 'is continuing to talk to Virgin and the tripartite authorities'.
According to the Daily Telegraph today, the Virgin consortium has not yet agreed on the funding for the Northern Rock mortgage bank.
Elsewhere, Norske Skog, the number two newsprint producer in the world, rose 2.89 pct as investors welcomed a decision by the group to writedown fixed assets and goodwill, resulting in a net reduction in equity of about 800 mln nkr, in a move towards making long-anticipated cutbacks in its capacity.
In earnings news, Belgian discount supermarket group Colruyt SA advanced 5.60 pct after its first half earnings results, released after the bell on Friday, exceeded analysts' expectations.
'Colruyt's results showed again its incredible strength in the Belgium market and its resilience to tougher market conditions,' Petercam analyst Fernand de Boer said.
In terms of economic news, the euro zone manufacturing purchasing managers index shows a continuously weakening trend despite the November rebound, according to economists.
The euro zone manufacturing PMI rose to a final 52.8 in November from 51.5 in October. The final reading was revised up from a provisional estimate of 52.6.
'Although the euro zone manufacturing PMI was revised up for November, the fact remains that activity remains markedly below the levels seen around mid-year. Euro zone manufacturers are clearly being buffeted by the potent headwinds coming from the credit crunch, very strong euro, elevated oil prices, higher interest rates and softer growth in key export markets,' said Howard Archer of Global Insight.
Later in the day, the US markets' counterpart of the PMI is in focus, with a reading of 50.4 forecast for the Institute for Supply Management's manufacturing index in November. This would be a slight drop from the 50.9 seen in the previous month. patrizia.kokot@thomson.com pk/jlc/kf1/lam//cmr COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
At 12.11 pm, the Dow Jones STOXX 50 was down 8.45 points or 0.23 pct at 3,744.22, while the STOXX 600 shed 0.17 points or 0.05 pct to 370.19.
Looking ahead, Wall Street is headed for a flat to slightly higher open, helped by a fresh drop in the price of oil which eased inflation fears.
According to spread bettors IG Index, the Dow Jones Industrial Average is expected to open up 17 points at 13,389. Separately, S&P 500 futures ticked up 0.30 point to 1,484, while Nasdaq 100 futures gained 0.75 point to 2,095.25.
In Europe, M&A news was in focus throughout the day, continuing the trend that started last month in the mining sector.
According to research by Thomson Financial, European target M&A activity soared in November to reach the highest monthly level of 2007.
The Dutch staffing sector remained in the spotlight today as the financial details regarding the takeover bid from Randstad for Vedior were announced, sending Vedior on an 8.82 pct rally. Randstad, down 9.74 pct, will offer Vedior shareholders 9.50 eur in cash and 32.759 pct of a share per Vedior share. The group also said it will issue 57 mln new shares to help finance the deal.
Over in France, Vivendi is currently trading 2.55 pct higher, after the group said Sunday that it agreed to acquire a 52 pct majority stake in Activision in exchange for its Vivendi Games games unit and 1.7 bln usd in cash, in a deal valued at a total of 18.9 bln usd.
Analysts at Natixis Securities see strong synergies between the two groups, with one a leader in online games and the other strongly positioned in console games.
'This is an attractive deal strategically and should be well-perceived. A little expensive, but then again they're not using much cash,' a Paris-based trader said.
In the German market, TUI is in focus after stating that it is examining several options including possible mergers for its Tuifly unit. Shares were 0.63 pct higher at last check.
Adidas -- up 1.45 pct -- entered the stage earlier when rumours circulated that Asics and Nike are mulling a joint bid at 65 eur a share. Traders were dismissive, pointing to Asics' small market cap.
Meanwhile, the announcement by Swiss Life that it will make a 30 eur per share agreed takeover offer for German independent financial advisor AWD led to a 30 pct surge in the latter. Swiss Life lost 5.66 pct.
Dealers noted that a takeover battle is unlikely, but highlighted the effect on other stocks in the sector, such as MLP AG or OVB Holding, which are currently rallying 14.37 pct and 5.41 pct respectively.
Staying among financials, Northern Rock shed 4.66 pct, with investors mulling over reports that both JC Flowers and Deutsche Bank have threatened to walk away from the negotiations. Deutsche Bank later denied a report in the Sunday Telegraph and said it 'is continuing to talk to Virgin and the tripartite authorities'.
According to the Daily Telegraph today, the Virgin consortium has not yet agreed on the funding for the Northern Rock mortgage bank.
Elsewhere, Norske Skog, the number two newsprint producer in the world, rose 2.89 pct as investors welcomed a decision by the group to writedown fixed assets and goodwill, resulting in a net reduction in equity of about 800 mln nkr, in a move towards making long-anticipated cutbacks in its capacity.
In earnings news, Belgian discount supermarket group Colruyt SA advanced 5.60 pct after its first half earnings results, released after the bell on Friday, exceeded analysts' expectations.
'Colruyt's results showed again its incredible strength in the Belgium market and its resilience to tougher market conditions,' Petercam analyst Fernand de Boer said.
In terms of economic news, the euro zone manufacturing purchasing managers index shows a continuously weakening trend despite the November rebound, according to economists.
The euro zone manufacturing PMI rose to a final 52.8 in November from 51.5 in October. The final reading was revised up from a provisional estimate of 52.6.
'Although the euro zone manufacturing PMI was revised up for November, the fact remains that activity remains markedly below the levels seen around mid-year. Euro zone manufacturers are clearly being buffeted by the potent headwinds coming from the credit crunch, very strong euro, elevated oil prices, higher interest rates and softer growth in key export markets,' said Howard Archer of Global Insight.
Later in the day, the US markets' counterpart of the PMI is in focus, with a reading of 50.4 forecast for the Institute for Supply Management's manufacturing index in November. This would be a slight drop from the 50.9 seen in the previous month. patrizia.kokot@thomson.com pk/jlc/kf1/lam//cmr COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2007 AFX News
