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Europe Factors-Share rally seen continuing on improving outlook
March 14, 2012 / 6:27 AM / in 6 years

Europe Factors-Share rally seen continuing on improving outlook

LONDON, March 14 (Reuters) - European shares were
expected to extend gains on Wednesday after hitting 33-week
highs the previous day, with recent positive economic data and
the U.S. Federal Reserve's expectations of an improvement in
growth boosting appetite for riskier assets.	
    The U.S. central bank said late on Tuesday it expected
"moderate" growth over the coming quarters with the unemployment
rate declining gradually. In January the Fed had said it
expected "modest" growth. It also said that most of the largest
U.S. banks passed their annual stress test. 	
    Futures for the Euro STOXX 50, Germany's DAX
 and France's CAC rose 0.4 to 0.6 percent,
indicating a higher open for equities. Financial spreadbetters
earlier predicted Britain's FTSE 100 to rise as much as
0.6 percent.	
    "Markets will once again open higher this morning. The main
drivers are the comments by the Fed and the news that JPMorgan
will buy back shares," said Philippe Gijsels, head of research
at BNP Paribas Fortis Global Markets in Brussels. 	
    "As long as the bonanza lasts, higher beta groups like
cyclicals and financials will continue to lead. Nevertheless as
risks to a correction have increased, it may be time to revisit
more defensive groups like pharmaceuticals."	
    The FTSEurofirst 300 index of top European shares
ended up 1.7 percent on Tuesday at 1,095.34 points, the highest
close since late July, on encouraging data from Germany and the
United States. The index, which fell 10.7 percent last year, has
gained 9.4 percent so far in 2012.	
    Technical outlook for the benchmark index improved after
recent gains. The index faces resistance at around 1,115 - a
high in July and a 78.6 percent Fibonacci retracement of a major
fall from February to September last year.	
    Investors will keep an eye on Italy, which is expected to
raise up to six billion euros at a bond auction on Wednesday and
bring the nation's 3-year borrowing costs below 3 percent, half
what it had to pay a few months ago. 	
    U.S. stocks surged 1.7 to 1.9 percent on Tuesday, boosted by
JPMorgan Chase's announcement of raising its dividend,
stronger-than-expected retail sales numbers and the Fed's
comments that recent strains on financial markets were easing. 	
    Japan's Nikkei average climbed 1.5 percent to close
above 10,000 for the first time in seven months on Wednesday.	
        	
     MARKET SNAPSHOT AT 0725 GMT                              
                                            LAST     PCT CHG    NET CHG
     S&P 500                            1,395.95      1.81 %      24.86
     NIKKEI                            10,050.52      1.53 %     151.44
     MSCI ASIA EX-JP   <.MIASJ0000PUS                 0.45 %       2.36
                       >                                      
     EUR/USD                              1.3037     -0.29 %    -0.0038
     USD/JPY                               83.11      0.27 %     0.2200
     10-YR US TSY YLD                      2.162          --       0.04
     10-YR BUND YLD                        1.889          --       0.07
     SPOT GOLD                         $1,669.89     -0.29 %     -$4.86
     US CRUDE                            $106.43     -0.26 %      -0.28
 	
    * Increased risk appetite lifts shares after data, Fed     
 	
    * Nikkei jumps above 10,000 for 4th day, blue chips up     
 	
    * Dollar stronger across the board, hits 11-mth high vs yen
 	
    * Brent crude steadies above $126 ahead of US oil data     
 	
    * Gold edges up on bargain hunting, U.S. dollar weighs     
 	
    * Brent crude steadies above $126 ahead of US oil data     
 	
    * Copper pauses after gains on data, Fed                   
 	
    * Wall St rallies in 2012's best day, Citi falls late      
 	
     	
    COMPANY NEWS	
    BAYER 	
    German chemicals and drugs group Bayer said its
HealthCare and CropScience divisions would widen their margins
and increase sales over the next three years. 	
	
    E.ON 	
    Germany's top utility expects its core profit to rise this
year and next as it banks on its renewable energy business and
foreign expansion following Germany's nuclear exit, which led it
to post a 2.22 billion euro ($2.9 billion)  net loss for 2011.
 	
	
    TULLOW OIL 	
    UK-based oil explorer Tullow Oil said profit soared last
year thanks to the ramp up of a major new field in Ghana,
allowing the company to announce a doubling of its dividend.
 	
	
    NOVO NORDISK  	
    The Danish insulin producer is planning to grow its
biopharmaceuticals businesses including growth hormone
treatments and hemophilia treatments, daily Jyllands-Posten
said. The two business areas are a significantly more profitable
than the key insulin business, Jyllands-Posten said.	
     	
    ROCHE  	
    Roche Holding AG said it received a request for additional
information from the Federal Trade Commission related to its
$5.7 billion hostile bid for U.S. gene decoder Illumina Inc
. 	
    	
    XSTRATA 	
    The company has sold a stake in its burgeoning Canadian
coking coal operations to JX Nippon, forming a joint venture
with the Japanese oil refiner to build the business and market
the coal in Japan. 	
      	
    SCHRODERS 	
    The company is in talks to acquire an almost 30 percent
stake in India's Axis Asset Management in a deal worth around
1.3 billion rupees ($26 million), two Indian newspapers reported
citing unnamed sources.   	
	
    EADS  	
    Europe's leading space company, Astrium, is "generally
interested" in acquiring one of two U.S. digital imagery
providers, GeoEye Inc or DigitalGlobe Inc, and
would look carefully at a deal if the price was affordable, a
top Astrium executive told Reuters.  	
      	
    TOTAL  	
    The sovereign wealth fund of Qatar has built up a 2 percent
stake in the French oil major since last summer, according to
newspaper Les Echos.  	
     	
    BIOMERIEUX   	
    The French in-vitro diagnostics group said it would temper
the ambitions put forward in its 2010-2015 strategic plan to
reflect a weaker economic outlook that has hit demand for its
testing products.  	
     	
    AMUNDI    	
    The asset-management industry will face continued pressure
on fund flows in 2012 as investors remain averse to risk and as
deposit-hungry banks lure clients away with lucrative returns,
the chief executive of Amundi told Reuters.   	
   Amundi, which is 75 percent-owned by French bank Credit
Agricole and 25 percent-owned by larger rival Societe
Generale, nonetheless expects to grow revenue and
profit this year as it expands its range of products and
partnerships.

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