European stock markets closed mostly higher on Friday, as a rally in the energy sector masked an otherwise lackluster performance on concerns over global interest rate and economic growth direction.
The German DAX 30 weakened 0.1 percent at 5,529, while the French CAC 40 rose 0.3 percent to 4,817 and the UK FTSE 100 rose 0.1 percent to 5,692.
The energy sector rallied on a wave of US deals, including Anadarko's US$21 billion of oil producer acquisitions, and a positive note on the oil industry from Deutsche Bank, which argued the sector was undervalued.
France's Total rose 2.4 percent; Royal Dutch Shell, which was upgraded by Deutsche Bank, added 1.4 percent; and gas explorer BG Group advanced 2.7 percent.
Citigroup strategists remained optimistic on European stock markets, noting that balance sheets are strong, companies are underleveraged, interest cover is high, cash-flow generation is strong and profit momentum is positive.
Still, the strategists acknowledged that strong equity demand looks unlikely over the coming weeks, so they urged investors to look for companies that can benefit from mergers-and-acquisition activity, leveraged buyouts, re-leveraging and bigger dividends.
One company benefiting from M&A was Associated British Ports, which rose 4.3 percent after agreeing to be bought for ?9.1 a share, or ?2.8 billion (US$5.1 billion) by a consortium led by Goldman Sachs. A consortium led by Macquarie Bank urged shareholders not to take action, raising the prospect the group may again try to match the Goldman-led group's offer, though 3i dropped out of the Macquarie consortium.
Deutsche Boerse fell 1.2 percent after NYSE Group CEO John Thain said in an interview with French newspaper La Tribune that the US exchange has the resources to increase its offer for Euronext if need be. Thought the Euronext has agreed to be bought by the NYSE, the Deutsche Boerse is still interested in buying the operator of stock exchanges in Paris, Amsterdam, Brussels and Lisbon.
Mittal Steel fell 2.6 percent in Amsterdam on increasing media speculation that Arcelor will agree to an improved Mittal offer. Mittal hasn't yet raised its bid but has now agreed with Arcelor on issues over corporate governance and strategy, La Tribune reported.
Arcelor has previously rebuffed the advances from the world's largest steelmaker and agreed to buy Russia's Severstal, in part to thwart the Mittal offer.
Softbank Group Corp plans to keep a stake in the chip designer Arm Ltd, even if it sells a partial interest to Nvidia Corp, the Nikkei reported. The companies are negotiating terms, the newspaper reported, citing sources. Softbank might take a stake in Nvidia after it buys Arm, the report said. Nvidia and Arm might also merge through a share swap, and Softbank would become a major shareholder in the combined company, it said. The two parties aim to reach a deal in the next few weeks, the sources said, asking not to be identified because the information is private. Nvidia is the
END TO SPECULATION: The hotel’s management contract has been extended, despite reports that it wanted to end its alliance with Hyatt Hotels over a deal with Riant Capital Singapore-based Hong Leong Hotel Development Ltd (豐隆大飯店股份) yesterday said it has extended a management contract to ensure the continued presence of the Grand Hyatt brand in Taipei, ending rumors that the two sides were parting ways. “We are pleased Hyatt is able to come to terms on the extension of the management contract of Grand Hyatt Taipei,” said Kwek Leng Beng (郭令明), executive chairman of City Developments Ltd (城市發展) and Millennium & Copthorne Hotels Ltd (千禧國敦酒店). Hong Leong Hotel Development is a subsidiary of Millennium, and both fall under the Hong Leong Group (豐隆集團). The Grand Hyatt Taipei (台北君悅大飯店), owned and built by
MOVING FROM CHINA? The article did not name the company, but Foxconn, Wistron and Pegatron were among firms chosen for a production-linked incentive plan in India An Apple Inc vendor is looking at shifting six production lines to India from China, which could result in US$5 billion of iPhone exports from the South Asian nation, the Times of India reported, citing people familiar with the matter who it did not identify. The establishment of the facility would create about 55,000 jobs over about a year, the newspaper reported, not naming the Apple vendor. It would also cater to the domestic market and expand operations to include tablets and laptops, the newspaper reported. Samsung Electronics Co and Apple’s assembly partners are among 22 companies that have pledged 110 billion
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB