European Factors to Watch-Shares to set new one-month low

Tue Feb 5, 2013 7:44am GMT

LONDON, Feb 5 (Reuters) - European shares were set to extend losses and hit
a new one-month low on Tuesday, with growing political uncertainty in Spain and
Italy and softer U.S. data preventing investors to bet on the resumption of a
recent rally.
    Futures for Euro STOXX 50, Germany's DAX and France's CAC
 were 0.1 to 0.2 percent lower. Financial spreadbetters earlier predicted
Britain's FTSE 100 to rise as much as 0.1 percent. 
    The indexes fell 1.6 to 3 percent in the previous session, while Spanish and
Italian bond yields rose on political uncertainties in the two highly-indebted
countries and lower-than-expected U.S. factory orders data.
    Spain's prime minister faced calls to resign over a corruption scandal,
while polls showed Italy's former prime minister Silvio Berlusconi regained
ground before elections this month, raising concerns about the euro zone
stability and growth. 
    "Political uncertainty in relation to Europe has crept back into investors'
thinking. Elections in Italy could leave the country's government ineffective, a
situation no one wants to see," Keith Bowman, equity analyst at Hargreaves
Lansdown, said.
    "For now, some selective profit taking appears to be the order of the day,
as investors look to assess whether this is just a wobble or the familiar
pattern of recent years."
    Spain's IBEX fell 3.8 percent on Monday, while Italy's FTSE MIB
 was down 4.5 percent. The FTSEurofirst 300 of top European
shares ended 1.5 percent lower at 1,150.91 points, its lowest close since Dec.
31. The index had climbed to a two-year peak last month.
    Britain's FTSE 100 index fell 1.6 percent to 6,246.84 points on
Monday, its biggest one-day fall in three months after a recent 4-1/2-year
highs.
    "Downside for FTSE 100 is still possible to 6,150, however, this is where
major support could kick in and help out as a platform for a renewal of the
uptrend," said Mike van Dulken, head of research at Accendo Markets.
    "Global macro outlook is still satisfactory and such correction are just a
healthy rite of passage."
    On the microeconomic front, focus will be on ICSC/Goldman Sachs chain store
sales data for the week ended Feb. 2 at 1245 GMT. In the previous week, sales
fell 1.0 percent.
    Redbook will release its Retail Sales Index of department and chain store
sales for January at 1355 GMT, while the Institute for Supply Management
releases its January non-manufacturing index at 1500 GMT. 
      
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     MARKET SNAPSHOT AT 0741 GMT                                
                                               LAST    PCT CHG   NET CHG
     S&P 500                               1,495.71    -1.15 %    -17.46
     NIKKEI                               11,046.92     -1.9 %   -213.43
     MSCI ASIA EX-JP                         552.20    -1.15 %     -6.43
     EUR/USD                                 1.3473     -0.3 %   -0.0040
     USD/JPY                                  92.21    -0.16 %   -0.1500
     10-YR US TSY YLD                         1.962         --      0.01
     10-YR BUND YLD                           1.608         --     -0.01
     SPOT GOLD                            $1,674.30     0.02 %     $0.30
     US CRUDE                                $96.00    -0.18 %     -0.17
 
    * Asian shares drop on euro zone worry, soft US data         
    * Nikkei drops as euro zone worries prompt profit taking     
    * S&P 500 posts worst day since Nov                          
    * Euro rally loses steam as political uncertainty grows      
    * Brent slips toward $115 on euro zone woes, firm dollar     
    * Platinum, palladium off multi-month highs                  
    * Copper slips from 4-mth high as U.S. data drags            
    * Bonds up as stock losses, euro zone concerns revive bid    
    
    COMPANY NEWS
     
    BP 
    Fourth quarter profits from shrinking British oil company BP Plc beat
analysts expectations, thanks in part to a record performance from its refining
division as a trial in the U.S. over its 2010 U.S. Gulf oil spill looms later in
February. 

    UBS 
    UBS said it will buy back 5 billion Swiss francs ($5.50 billion) in senior
debt in coming weeks, after a huge scaleback at its investment bank dramatically
reduced liquidity and funding needs. 
    
    BG GROUP 
    British oil and gas company BG Group posted a 29 percent drop in quarterly
earnings, hurt by a one-off tax credit, and said that it will miss its target of
producing more than 1 million barrels of oil per day by 2015. 

    ARM 
    British chip designer ARM reported a better-than-expected 16 percent rise in
pretax profit in the fourth quarter as it rode the wave of soaring sales of
smartphones and tablets, nearly all of which contain its technology.
 
    
    GIVAUDAN 
    Fragrance and flavour maker Givaudan hiked its dividend and confirmed its
mid-term targets after strong demand for its ingredients for toothpastes,
deodorants and washing powder pushed full-year net profit ahead of forecasts.
 
    
    KPN 
    Dutch telecoms group KPN plans to cut its debt with a
4-billion-euro ($5.4 billion) cash call to shareholders, it said on Tuesday,
after posting a fourth-quarter net loss. 
    
    ANGLO AMERICAN 
    The miner will report an underlying loss in respect of Anglo American
Platinum of $225 million in its annual results due out next week,
according to the Telegraph.
    
    ROYAL DUTCH SHELL 
    Anglo-Dutch oil major's Indian unit will challenge a claim by the local tax
authorities that a share sale to its overseas parent in 2009 was undervalued by
$2.7 billion, the latest tax conflict involving a foreign company in India.
 
    
   MONTE DEI PASCHI DI SIENA 
   Italian prosecutors called in the former chairman of Monte dei Paschi di
Siena on Monday as they pursued their corruption investigation into an opaque
series of loss-making derivatives trades at the bank. 

    SANOFI 
    French drugmaker Sanofi said on Tuesday that its Zaltrap drug had been
approved for marketing in the European Union to treat metastatic colorectal
cancer. 
        
    GDF SUEZ 
    Belgian utility group Electrabel, a unit of France's GDF Suez, will
carry out further tests on two nuclear reactors that were halted by the
regulator in 2012 over safety concerns, and present the results by the end of
March, the group said on Monday. 
    
    GAGFAH 
    The German real estate group, controlled by U.S. investor Fortress,
said it is to refinance a 1 billion euro loan of its Woba unit, leading it to
scrap the sale of the division.
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