RTTNews - European stocks are likely to open modestly higher on Monday after British bank Barclays reported an 8% increase in its first-half net profit, boosted by the performance of its investment banking division, though the results were slightly below analysts' estimates. HSBC is also set to announce its earnings later in the day. Meanwhile, rising commodity prices may help energy and mining shares.
Germany's Federal Statistical Office announced that the retail sales in real terms dropped 1.6% year-over-year in June, compared to a 3.7% fall in May, revised from 2.9% decline reported initially. Economists were looking for an increase of 0.9%. A year earlier, retail sales were down 4%. Investors look forward to the results of the Purchasing Managers' Index survey for the manufacturing sector.
After making cautious moves in early trading, Asian stocks edged higher on Monday after brokerage CLSA' purchasing managers index for China rose to a one-year high of 52.8 in July from 51.8 in the previous month, raising optimism about a global economic recovery.
On Friday, Wall Street ended on a mixed note. While the Dow Jones Industrial Average ended up 0.19%, the tech-heavy Nasdaq edged down 0.29% and the S&P 500 index rose 0.07%. The GDP report from the commerce department revealed that the U.S. economy continued to shrink by a slower than expected margin, but trader sentiment was hit to an extent as consumer consumption came in far lower than expected.
Crude oil jumped nearly 4% to close at a four-week high of $69.45 a barrel on Friday after a better-than-expected U.S. gross domestic product report boosted the outlook for energy demand. Because of encouraging developments in the oil market, crude oil prices will reach $80 per barrel by the end of this year, the oil ministry website, SHANA, reported on Sunday quoting Iran's OPEC governor. In Asian trading on Monday, light sweet crude for September delivery rose further to above $70 a barrel.
In corporate news, online auctioneer eBay Inc. said it expects an adverse result for its online communication system business, Skype, if the legal battle with Joltid is not resolved through negotiation.
Barclays plc said its six-month pre-tax profit increased to £2.98 billion from £2.75 billion in the comparable period. Half-year profit for the period rose to £2.34 billion from £2.13 billion in the prior year period
U.K.-based Royal Bank of Scotland Group plc is close to sealing long-anticipated deal to sell some of its Asian assets to Australia & New Zealand Banking Group, according to media reports. The deal may close as early as this week.
The CEO of industrial gases maker Air Liquide SA said that the U.S. and Asia are leading a recovery in industrial output while lagging European countries like France may not have bottomed out yet.
European Competition Commissioner Neelie Kroes said Friday she intends to clear German carrier
Deutsche Lufthansa AG's plans to purchase Austrian Airlines AG, though with conditions attached.
France's construction company Eiffage SA said its second-quarter revenue dropped 2.1% to 3.47 billion euros. ING Group NV agreed to sell its non-core annuity and mortgage businesses in Chile to Corp Group Vida Chile, S.A.
Linde AG reported that earnings for the first six months of fiscal 2009 were 274 million euros, down from last year's 402 million euros. Rexam plc announced that it is to cease making beverage cans and can ends at its Dmitrov plant near Moscow to address the continued weakness in the Russian beverage can market.
Shire plc reported positive results from the first of three Phase III studies of velaglucerase alfa, its enzyme replacement therapy in development for the treatment of Type 1 Gaucher disease. Intertek Group plc reported that profit attributable to equity holders of the company grew to GBP 59.3 million or 36.9 pence per share from GBP 39.5 million or 24.8 pence per share a year ago.
Cobham plc announced that it has received £18 million contract by Ascent Flight Training for the first phase of the United Kingdom Military Flying Training Service or UKMFTS
The European markets fell on Friday, as weak results from Air France-KLM, Eni and Total dampened investor sentiment. The FTSEurofirst 300 index of pan-European blue chips closed 0.20% lower, while the narrower DJ Stoxx 50 index fell 0.66%. Around Europe, the U.K.'s FTSE 100 index dropped 0.57%, France's CAC 40 index fell 0.14% and Germany's DAX index slipped 0.53%.
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