European Shares Break Even
Enviado: 16/7/2003 11:50By Huw Jones
LONDON (Reuters) - European stocks traded sideways midmorning on Wednesday as Britain's Marks & Spencer sent a chill through retailers, but chip-related shares rose and insurers advanced for a fourth day.
Many investors took time out to digest a slew of earnings news as the reporting season gathered pace on both sides of the Atlantic, but concern about the economy continues to keep bourses in a trading range.
Earnings reports to date have been generally reassuring, especially in the U.S. banking sector, while Dutch chip equipment maker ASML's weak numbers were no real surprise, said Thierry Lacraz, a strategist at Pictet & Cie bank in Geneva.
"You have a lot of people who are dubious about the recovery but they will probably change their mind over the coming month," Lacraz said.
By 4:44 a.m. EDT, the FTSE Eurotop 300 index was flat at 871 points as the pan-European blue-chip benchmark struggles to match and break above its January highs
Among DJ Stoxx sectoral indices, banks, consumer cyclicals, technology, and industrials all made new 2003 highs.
The narrower DJ Euro Stoxx 50 index was off 0.16 percent at 2,498 points.
Nevertheless, the equity risk premium continues to ease, signaling a greater appetite for riskier assets such as technology shares, while share volatility, a key "fear factor" gauge, as dropped to its lowest level in a year, Lacraz said.
Federal Reserve Chairman Alan Greenspan delivers the second day of his testimony on the U.S. economy to a Congressional committee at 10 a.m. EDT, though much of it will be a repeat of his comments on Tuesday.
The Fed chief vowed to keep U.S. interest rates low for a long time even as he predicted a hearty economic recovery.
The dollar climbed to two-month highs and bond prices tumbled after Greenspan downplayed deflation dangers.
U.S. stock index futures were firmer as Wall Street was headed for a higher opening, buoyed by solid earnings overnight from global chip bellwether Intel Corp.
ASML RECOVERS, M&S MIRED
ASML, the Dutch chip equipment maker, reported a second-quarter net loss of 64 million euros and said it would cut a further 11 percent of its workforce.
ASML said it expects to reach a new breakeven level by the first quarter of next year.
The shares initially fell, but later recovered to edge up 0.9 percent to 11.23 euros and hit a new high for the year.
After New York's close, Intel posted second-quarter earnings that doubled from a year earlier on stronger sales and forecast better profit margins for the third quarter and the rest of the year on higher sales and lower production costs.
Intel shares rose in after-hours trade, and helped to boost Europe's chip-related shares, with German chipmaker Infineon up 1.6 percent at 11.07 euros.
Meanwhile, Britain's biggest clothing retailer Marks & Spencer said clothing sales rose by 3.9 percent in the first quarter, bouncing back from a fourth-quarter dip.
However, dealers had hopes for a bigger bounce, and sent the shares down 5.9 percent to 315-1/2 pence. Panmure issued a "sell" rating on the stock.
Insurance share led bourses higher as the sector continues to push into the black for the year after slumping to multi-year lows in March as stock markets crumbled, hitting the value of their equity-related assets.
Among the sector leaders, Munich Re rose 1.2 percent to 98.39 euros.
The U.S. earnings season continues in high gear with results due on Wednesday from International Business Machines, Apple Computers , Advanced Micro Devices, and Ford Motor .
U.S. consumer prices for June are due at 8:30 a.m. EDT, along with U.S. business inventories for May. Consumer prices are forecast by economists to have risen 0.2 percent last month.
June U.S. industrial capacity utilization and production numbers are due at 9:15 a.m. EDT.
Copyright © 2003 Reuters Limited.
LONDON (Reuters) - European stocks traded sideways midmorning on Wednesday as Britain's Marks & Spencer sent a chill through retailers, but chip-related shares rose and insurers advanced for a fourth day.
Many investors took time out to digest a slew of earnings news as the reporting season gathered pace on both sides of the Atlantic, but concern about the economy continues to keep bourses in a trading range.
Earnings reports to date have been generally reassuring, especially in the U.S. banking sector, while Dutch chip equipment maker ASML's weak numbers were no real surprise, said Thierry Lacraz, a strategist at Pictet & Cie bank in Geneva.
"You have a lot of people who are dubious about the recovery but they will probably change their mind over the coming month," Lacraz said.
By 4:44 a.m. EDT, the FTSE Eurotop 300 index was flat at 871 points as the pan-European blue-chip benchmark struggles to match and break above its January highs
Among DJ Stoxx sectoral indices, banks, consumer cyclicals, technology, and industrials all made new 2003 highs.
The narrower DJ Euro Stoxx 50 index was off 0.16 percent at 2,498 points.
Nevertheless, the equity risk premium continues to ease, signaling a greater appetite for riskier assets such as technology shares, while share volatility, a key "fear factor" gauge, as dropped to its lowest level in a year, Lacraz said.
Federal Reserve Chairman Alan Greenspan delivers the second day of his testimony on the U.S. economy to a Congressional committee at 10 a.m. EDT, though much of it will be a repeat of his comments on Tuesday.
The Fed chief vowed to keep U.S. interest rates low for a long time even as he predicted a hearty economic recovery.
The dollar climbed to two-month highs and bond prices tumbled after Greenspan downplayed deflation dangers.
U.S. stock index futures were firmer as Wall Street was headed for a higher opening, buoyed by solid earnings overnight from global chip bellwether Intel Corp.
ASML RECOVERS, M&S MIRED
ASML, the Dutch chip equipment maker, reported a second-quarter net loss of 64 million euros and said it would cut a further 11 percent of its workforce.
ASML said it expects to reach a new breakeven level by the first quarter of next year.
The shares initially fell, but later recovered to edge up 0.9 percent to 11.23 euros and hit a new high for the year.
After New York's close, Intel posted second-quarter earnings that doubled from a year earlier on stronger sales and forecast better profit margins for the third quarter and the rest of the year on higher sales and lower production costs.
Intel shares rose in after-hours trade, and helped to boost Europe's chip-related shares, with German chipmaker Infineon up 1.6 percent at 11.07 euros.
Meanwhile, Britain's biggest clothing retailer Marks & Spencer said clothing sales rose by 3.9 percent in the first quarter, bouncing back from a fourth-quarter dip.
However, dealers had hopes for a bigger bounce, and sent the shares down 5.9 percent to 315-1/2 pence. Panmure issued a "sell" rating on the stock.
Insurance share led bourses higher as the sector continues to push into the black for the year after slumping to multi-year lows in March as stock markets crumbled, hitting the value of their equity-related assets.
Among the sector leaders, Munich Re rose 1.2 percent to 98.39 euros.
The U.S. earnings season continues in high gear with results due on Wednesday from International Business Machines, Apple Computers , Advanced Micro Devices, and Ford Motor .
U.S. consumer prices for June are due at 8:30 a.m. EDT, along with U.S. business inventories for May. Consumer prices are forecast by economists to have risen 0.2 percent last month.
June U.S. industrial capacity utilization and production numbers are due at 9:15 a.m. EDT.
Copyright © 2003 Reuters Limited.