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Europe Factors to Watch-Shares set to rise on U.S. fiscal deal hopes
November 19, 2012 / 6:26 AM / 5 years ago

Europe Factors to Watch-Shares set to rise on U.S. fiscal deal hopes

PARIS, Nov 19 (Reuters) - European stocks are set to rise on Monday,
tracking gains on Wall Street and in Asia on hopes of a deal in Washington to
avoid a damaging "fiscal cliff".
    At 0725 GMT, futures for Euro STOXX 50, for Germany's DAX 
and for France's CAC were up 0.8-1.0 percent.
    On Friday, leaders of the U.S. Senate and House emerged from a meeting at
the White House and said they would be flexible in efforts to settle fiscal
policy differences, sparking a late rally on Wall Street. 
    Over the weekend, leading U.S. lawmakers also expressed confidence that a
deal would be reached. 
    Investors have been fretting about how the U.S. government will avoid
stepping off the $600 billion 'fiscal cliff' of spending cuts and tax rises
which automatically kick in the new year without a political agreement on
setting the budget, which could drag the U.S. economy back into recession.
    "It will be tense, just like last year, but at the end there should be a
deal otherwise it's political suicide. I'm confident we'll have a Christmas
rally, so I'm 'long equities'," a Paris-based trader said.
    The FTSEurofirst 300 index of top European shares sank 2.7 percent
last week - its worst weekly performance in nearly six months - hurt by fears
over Washington's "fiscal cliff" as well as renewed worries over Greece's debt
    Greece will again be in the spotlight ahead of a meeting of the Eurogroup on
Tuesday. Disagreements among European policymakers and the IMF is threatening to
delay the next 31.5 billion euro tranche of Greece's bailout, which could push
the country close to bankruptcy.
    IMF managing director Christine Lagarde said over the weekend that she would
push for a permanent solution to Greece's debts to avoid prolonged uncertainty
and further damage to the Greek economy. 
 MARKET SNAPSHOT AT 0724 GMT                            
                                         LAST  PCT CHG  NET CHG
 S&P 500                             1,359.88   0.48 %     6.55
 NIKKEI                              9,153.20   1.43 %   129.04
 MSCI ASIA EX-JP                       509.64    0.4 %     2.02
 EUR/USD                               1.2765    0.2 %   0.0025
 USD/JPY                                81.26     -0 %   0.0000
 10-YR US TSY YLD                       1.603       --     0.02
 10-YR BUND YLD                         1.328       --     0.00
 SPOT GOLD                          $1,723.10   0.56 %    $9.61
 US CRUDE                              $87.89   1.12 %     0.97
  > GLOBAL MARKETS-Asian shares rise on positive U.S. tone 
  > Washington's positive tone cheers Wall St for a day 
  > Tokyo's Nikkei share average closes up 1.43 pct 
  > TREASURIES-Prices drop in Asian trading, pulling yields off lows 
  > Yen hits 7-mth low on likely next govt's calls for easing 
  > Gold firms on soft dollar; US fiscal talks eyed 
  > Copper rallies on hopes for U.S. fiscal fix 
  > Brent climbs to above $109 on Mideast tensions 
    Italian biggest bank by assets is in talks with Kazakh investors over the
sale of a controlling stake in Kazakhstan's ATF Bank, three sources
with knowledge of the matter said on Saturday. 
    Shareholders in Telco, the holding company that controls Telecom Italia,
will discuss Egyptian tycoon Naguib Sawiris' proposal to help the group acquire
Brazil's GVT and finance other investment after a board meeting on Dec. 6,
Corriere della Sera reports.
    Moody's has placed on review for downgrade the Baa3/Prime-3 long and
short-term debt and deposit ratings of the Italian lender. The review primarily
reflects Moody's view that bank's internal capital generation is low and that
its asset quality is weakening, the rating agency said in a statement on
    Spain's Santander plans to invest in the country's so-called bad
bank in a sign that healthy domestic lenders are willing to support the entity
created to clean up the aftermath of a 2008 property crash. BBVA and Sabadell
are considering investing in the vehicle but have yet to make a decision

    Germany's network regulator said on Friday it will lower the rates the four
mobile operators can charge each other to connect calls, putting further
pressure on their already shrinking revenues. 
   A Daimler and Bosch joint venture on electric engines is raising
its original target to produce 1 million units to 2 million units by 2020, the
Hannoversche Allgemeine Zeitung said on Saturday, citing a company executive. 
   Separately, Der Spiegel reported that Daimler will enlarge its management
board to put a top executive in charge of its troublesome Chinese car business.
    The engineering group is able to deliver only 3 of the 8 ICE high-speed
trains it had planned to have finished for rail operator Deutsche Bahn 
by December because of software problems, daily Die Welt reported, citing an
unnamed Siemens employee. 
    The builder said its Chief Executive Frank Stieler has agreed to step down
and Marcelino Fernandez Verdes of majority shareholder ACS is set to
replace him, in a sign of the Spanish parent company seeking tighter control.  
Hochtief's supervisory board chairman Manfred Wennemer would also resign, it
   Spanish oil major Repsol hopes to reach an agreement with Argentina
on compensation for the nationalisation of Repsol's YPF subsidiary, the
company's chairman said in an interview published on Sunday. 
    The Dutch engineering consultancy, which specialises in surveys for marine
construction and offshore exploration, lowered its 2012 outlook due to low
seismic vessel utilisation and a write-off in subsea. 

    CEO Henri Proglio denied talk of tensions between him and Francois Hollande
over his role as head of the state-owned power group, saying he had a "normal"
relationship with the French president. The CEO, who was speaking after a trip
with Hollande to Poland, said that if the government had wanted to eject him
from his post, it would have done so already. 
    The waste and water group plans to cut a fifth of the 500 posts at its
headquarters, where possible through voluntary departures, the Nouvel
Observateur reported.
    Credit Suisse Group AG will pay $120 million to settle U.S. civil charges
that it misled investors in the sale of risky mortgage bonds prior to the 2008
financial crisis, U.S. regulators said on Friday. 
    Swiss drugmaker Roche's cancer drug Avastin failed to make a statistically
significant difference to survival rates of patients with a common form of brain
cancer in a late-stage study, the company said on Saturday. 
    Japan's Nidec Corp is interested in Finmeccanica's power
engineering unit AnsaldoEnergia and is ready to invest 1 billion euros ($1.27
billion) to expand its presence in Europe, president Shigenobu Nagamori told Il
Sole 24 Ore on Saturday.

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