DJ EUROPEAN MORNING BRIEFING: Lower On US Economic Woes

US SUMMARY: Economic Woes Cloud Stocks

DJIA 11076.18 loss 97.41 dn 0.9%
NASDAQ 2060.28 loss 0.57 0.0%
S&P 500 1265.95 loss 5.53 dn 0.4%
Dow Future 11118.00 gain 2.00 0.0%
NASDAQ Future 1494.75 loss 0.25 0.0%
S&P Future 1271.50 0.00 0.0%
Euro-USD 1.2875 gain 0.0013 up 0.1%
(Futures values, Treasury, EUR/USD Data as of 0450 GMT)
Fears the U.S. economy is slowing concerned investors Wednesday taking the shine off strong corporate earnings from Cisco Systems and Walt Disney. Treasurys edged lower, whilst the dollar was mixed and the price of oil was higher.

STOCKS: Investors are still digesting Tuesday's decision by the Federal Reserve to leave the federal-funds rate unchanged at 5.25% after 17 straight quarter-point increases. While the move came as little surprise, many investors are left wondering what will happen next, as the Fed left the door open to more rate increases. That prospect sent stocks lower late in Tuesday's session after they had been up for much of the day.

"While the Fed has paused for now, the [Federal Open Market Committee] press release signaled that the central bank stands ready to resume rate hikes should the growth damper on inflation no longer prove adequate," Bart Melek at BMO Nesbitt Burns said in a morning note. "In other words, the Fed decided to put in a 'hawkish pause,' and the move should not be interpreted as a move toward a neutral policy stance."

Technology stocks advanced after Cisco Systems reported late Tuesday strong 4Q results.

"Cisco's favorable earnings news is encouraging for the troubled technology sector," said Jack Ablin, chief investment officer at Harris Private Bank.

FOREX: The dollar was down against the yen Thursday.

Investors will be awaiting U.S. trade data set for release Thursday, such releases have not made much of a dent in the currency market as of late.

A July retail sales report set for release Friday is likely to have a greater impact on the market, analysts said, as investors will use it as another indicator of just how fast the U.S. economy is cooling.

The dollar was mixed late Wednesday, down against the euro but up against the yen. With little fresh U.S. data on tap, investors continued to digest the Fed's decision to pause its rate tightening cycle.

BONDS: Treasury prices settled unchanged to lower Wednesday, with the market in a mood of consolidation amid new debt sales and after the Fed's decision Tuesday to pause its rate-tightening cycle.

OIL: Weekly U.S. inventory data from the Department of Energy showed crude and gasoline stocks fell more than expected last week. The declines come at a sensitive time for the industry, with BP's disruption at the Alaskan Prudhoe Bay oil field - the largest in the U.S. - although the company could keep part of it open. Crude futures jumped 94 cents to $77.25 a barrel, on pace to break a nominal settlement record of $77.03, set July 14.

ASIAN SUMMARY: Stocks Lower On Weak Wall Street

USD-Yen 115.13 loss 0.23 dn 0.22%
Some data not available for technical reasons
STOCKS: Asian markets were mostly lower Thursday, with Japan's stocks edging slightly down after Wall street provided a negative lead for Asian markets.

Australian shares also pushed lower amid selling encouraged by a fall on Wall Street and stronger than expected jobs data, which raised expectations for future interest rate increases. Commonwealth Bank of Australia was among the fallers following broker downgrades after its full year results yesterday.

FOREX: The dollar was down against the yen, on seling by Japanese exporters, says a trader.

BONDS: Prices of Japanese government bonds fell as traders adjust positions ahead of BOJ's Fukui's press conference and Friday's Japan 2Q GDP.

"Players are cautious about buying JGBs after the strong machinery orders data so may react more to strong GDP figures" than weak ones, says Morgan Stanley's Takafumi Yamawaki.

METALS: Gold's retreat from a session high $652.15/oz to $649.25 currently is described as profit-taking from sharp overnight gains, with low volumes and the loss of the key $650 level exacerbating moves. Ongoing Mideast conflicts and high oil are also adding to gold's near-term support.

OIL: Prices fell to $76.26 Thursday. The situation in the middle east continues to worsen and may put pressure on oil prices Thursday. A report by the independent newspaper says that Israel has approved a major escalation of war by voting to send thousands of fresh troops deeper into Lebanon in an expanded offensive echoing its invasion nearly a quarter of a century ago Ceasefire plan facing collapse

EUROPEAN OUTLOOK: Weaker Global Markets To Hurt Stocks

Euro-USD 1.2822 loss 0.0020 dn 0.2%
Stlg-USD 1.9050 loss 0.0020 dn 0.1%
USD-Franc 1.2275 gain 0.0022 up 0.2%
(All values as of 0450 GMT)
European stocks are expected to open sharply lower Thursday, after a weaker close on Wall Street overnight. Prices of government debt are seen edging lower at the start, as the euro opens little changed against the dollar.

STOCKS: European stocks are seen opening lower, after U.S. economic concerns sent Wall Street lower overnight.

Spreadbetter Cantor Index is calling the FTSE to open down 39 points at 5821, the DAX down 50 at 5652 and the CAC down 42 at 4983.

European shares ended higher Wednesday after a postive start to trading on Wall street. Technology stocks were boosted by positive 4Q results from networking giant Cisco.

In corporate news, Deutsche Telekom warned late Wednesday it expects earnings and sales in 2006 and 2007 to come in lower than previously expected due to an intense competitive environment in Germany. The news came in after competitor Swisscom also lowered its full year guidance after reporting disappointing 2Q results.

News of two profit warnings is likely to weigh heavily on the telecoms sector Thursday.

BONDS: European government bond prices might head slightly lower in line with treasurys overnight, also on worry about bank of England minutes.

The Bank of England Monetary Policy Committee's quarterly inflation report released Wednesday, proved less hawkish than many were expecting.

Analysts said the market had priced in too much in terms of rate hikes after last week's move took many by surprise.

"We had overcooked the rate rise expectations quite enormously, well beyond anything that was reasonable to assume," said Marc Ostwald, a strategist at Insinger de Beaufort.

"Overall I think the message is that they are not likely to be very aggressive even if inflation does tick up a bit more," he said.

European government bonds fell Wednesday, with bunds and gilts hit by profit-taking and concerns the Federal Reserve might still have to hike interest rates to slow inflation, analysts said.

FOREX: The euro opens little changed, but with firm support on interest rate considerations.

With little fresh U.S. data set for release Thursday, the market could remain inert, analysts said, as the market slowly shifts its maniacal focus on the Fed to the policies of other central banks.

Market participants have already starting touting the prospects for the pound, speculating that is still has room to rise even after its strong performance following the Bank of England's surprise move to hike rates last week.

"A stronger-than-expected rebound in the economy and renewed Bank of England tightening has boosted the pound," noted Marc Chandler, global head of foreign exchange at Brown Brothers Harriman, which upgraded its forecast for sterling Wednesday. "Another BOE hike seems likely by year-end, and sterling seems likely to keep pace with a stronger euro over the balance of 2006."

CALENDAR: Thursday, Aug 10

GMT Expected Previous
0500 JPN July Consumer Sentiment Index 47.2
0640 FRA June Indus Output -0.2%MM 2.0%MM
1.7%YY 2.7%YY
0640 FRA June Mfg Production -0.8%MM 2.5%MM
2.4%YY 3.8%YY
0645 FRA June Trade Balance -1.8B -1.8B
1000 GER Aug ECB Bulletin
1230 US Aug 5 Jobless Claims Unch +14K
1230 US June Trade Deficit $64.8B $63.84B
1400 US July 29 DJ-BTMU Business Barometer -0.6%
1430 US Aug 4 US Energy Dept Natural Gas Stocks (in -5 +19
billion cubic feet)
1800 US July Fedl Budget Statement -$40B +$20.47B
2030 US Aug 4 Money Supply
2350 JPN 2Q GDP +0.4%QQ +0.8%QQ
N/A JPN PM Koizumi meets Mongolia Pres
Enkhbayar in Mongolia
N/A JPN BOJ Policy Board mtg starts

-By Clare Connaghan; Dow Jones Newswires; [email protected]

(MORE TO FOLLOW) Dow Jones Newswires

August 10, 2006 01:45 ET (05:45 GMT)

10 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Corporate Events

Air France-KLM (3112.FR): 1Q Revenue
Average sales (DJ, 3 analysts): EUR5.76B (EUR5.19B)
Note: Traffic growth for period was good and Lufthansa has also already reported good revenue growth for the period, analyst notes, so no surprises expected. Will be looking for indications that yields holding up despite increased fuel surcharges. Company reports Thursday pre-market.

Aegon (AEG): 2Q Earnings
Average net profit (DJ, 6 analysts): EUR528M (EUR751M)
Note: Realized gains in 2Q 05 were exceptionally high, says Jacob Bosscha of SNS Securities. Underlying developments expected to be strong. JPMorgan says US business likely benefited from new products launched earlier this year. Aegon also disclosing embedded value -used by life insurers to reflect the value of existing portfolio and future profits.

AGF (12592.FR): 1H Earnings
Average net profit (DJ, 4 analysts): EUR864M (EUR738M)
Note: Analysts say growth should be driven by the insurer's life and savings business and by lower claims costs as a proportion of premium income. Credit insurance unit Euler Hermes also expected to make a strong earnings contribution, analysts say

Ahold (AHO): 2Q Revenue
Average sales (DJ, 4 analysts): EUR10.53B (EUR10.45B)
Forecast range: EUR10.48B - EUR10.65B
Note: Strong sales from Ahold's Dutch retail operations and positive currency effects seen almost offsetby a sluggish performance of Ahold's US retail operations which will be in analysts' focus when Ahold reports its 2Q trading update Thursday at 0600 GMT.

Bilfinger Berger (GBF.XE): 2Q Earnings
Average net loss (DJ, 4 analysts): EUR3.6M (N/A)
Average EBITA: EUR13.1M (EUR35M)
Note: 2Q net loss on possible impairment charges for the Cross City Tunnel in Sydney, a toll-road which has failed to meet expected traffic volumes, analysts say. But building output is seen +4.2% in 2Q to EUR2.02B from EUR1.94B in the same period a year earlier. 2Q EBITA is seen -63% on the year. Services sector seen posting strong earnings.

Bouygues (12050.FR): 2Q Revenue
Average Sales (DJ, 7 analysts): EUR6.85B (EUR6.42B)
Forecast range: EUR6.66B - EUR7.03B
Note: Focus on mobile telecoms unit Bouygues Telecom, where analysts concerned new subscribers are being won at terms that will weigh on profitability. Also look for company to lift FY guidance for construction, road building units. Bouygues reports Thursday after market close.

Danske Bank (DANSKE.KO): 2Q Earnings
Average pretax profit (SME Direkt, 16 analysts): DKK3.87B (DKK4.19B)
Average net interest income: DKK4.64B (N/A)
Average net fee income: DKK1.91B (N/A)
Note: Pretax profit hurt by higher loan losses, costs, lower remortgaging volumes as well as lower life insurance investment returns on the back of recent stock market volatility. Net interest income is seen +9% and net fee income +5.4%. Focus is on Irish bank operations.

Delhaize (DEG): 2Q Earnings
Average net profit (DJ, 5 analysts): EUR96.06M (EUR76.9M)
Average sales: EUR4.8B (EUR4.59B)
Note: Analysts expect a 4.6% increase in sales. Growth likely to be driven by the US market, where Safeway (SWY) and Kroger (KR) have already posted strong results. Analysts will be looking for company comment on the progress of its conversion of Kash n' Karry stores to Sweetbay, the expansion of the Food Lion and Hannaford chains. Like for like sales growth in the US also in focus. Results due at 0600 GMT Thursday.

DnB NOR (DNBNOR.OS): 2Q Earnings
Average operating profit (SME, 17 analysts): NOK3.32B (NOK3.19B)
Average net interest income: NOK3.67B (NOK1.82B)
Note: Operating profit is mainly boosted by its Northeastern Europe DnB NORD joint venture. Net interest income is seen +7.5% and commission income +21%. Analysts will be eyeing margin outlook, especially after Nordea's (NDA.SK) 2Q comments on Norwegian margin pressure, as well as developments in its life insurance operations.

Douglas (DOU.XE): 3Q Earnings
Average net profit (DJ, 5 analysts): EUR4.4M (EUR2.4M)
Average EBITDA: EUR34.8M (EYR30.2M)
Average sales: EUR583.2M (EUR526M)
Note: Analysts say Douglas is likely to have benefited from this year's late Easter and from the World Cup tournament in Germany. The jewelry business is expected to have profited in particular from the positive calendar effect, while sales in the fashion segment are also seen rising due to store openings.

Fortis (30086.AE): 2Q Earnings
Average net profit (DJ, 8 analysts): EUR953M (EUR1.05B)
Note: "The main reason for the lower result is that 05 2Q was the strongest quarter of 05," Rabo says. Banking side to benefit from strong retail results in Belgium. JPMorgan expects contribution from Turkish bank to remain limited.

Geberit (GEBN.EB): 1H Earnings
Average net profit (DJ, 4 analysts): CHF174M (CHF142M)
Average EBIT: CHF255M (CHF196M)
Average sales: CHF1.08B (CHF974M)
Note: Improvements are due to better German demand and tight cost control, although higher financing charges and tax expenses will likely weigh on the bottom line. Outlook and any news on a share buyback is eyed.

ING (ING): 2Q Earnings
Average net profit (DJ, 6 analysts): EUR1.58B (EUR1.55B)
Note: ING's banking result will benefit from higher commission, net interest income, says Bear Stearns. Overall, "2Q 06 results should show continued encouraging underlying trends," Bear Stearns says. Has outperform rating. Investors will eye results in Taiwan and at ING Direct, the high-yield online franchise. ING will report its results at 0500 GMT.

International Power (IPR): 1H Earnings
Pretax, pre-exceptionals profit (DJ, 4 analysts): GBP255M (GBP142M)
EPS Pre-exceptionals: 11p (6.7p)
Note: Growth pinned on rising UK power prices and improved market conditions in North America. Middle East should benefit from the addition of Tihama and now Al Hidd power plants, whilst Australia and the Asia markets should be little changed year on year, analysts say.

Nobel Biocare (NOBE.VX): 2Q Earnings
Average net profit (DJ, 10 analysts): EUR40.2M (EUR31.2M)
Average EBIT: EUR51.5M (EUR39.5M)
Average sales: EUR152.8M (EUR123.8M)
Note: Key growth drivers will remain North America, where Nobel Biocare is very active in terms of marketing, says Helvea analyst Daniel Jelovcan. Market will be watching out for company comments on the ongoing dispute with the Swedish Medical Products Agency, which has questioned the safety of the company's Nobel Direct implant.

Old Mutual (OML.LN): 1H Revenue
Average sales (DJ, 3 analysts): GBP802M (GBP739M)
Note: Analysts attribute performance to better demand for fixed annuity products and increased market share in South Africa. Analysts looking for further news on integration of Skandia acquisition and clues about what Old Mutual is doing to raise US sales.

Panalpina (PWTN.EB): 2Q Earnings
Average net profit (DJ, 3 analysts): CHF37.4M (CHF34M)
Average net forwarding revenue: CHF1.94B (CHF1.78B)
Note: 2Q net profit is reflecting a healthy industry growth already visible at Swiss peer Kuehne; Nagel (KNIN.EB). Analysts will scrutinize volume growth and margin developments, as well as a possible update on a new CFO after the previous was promoted to CEO.

Prokom Software (PKM.WA): 2Q Earnings
Average consolidated net profit (DJ, 7 analysts): PLN14.2M (PLN15.5M)
Average sales: PLN421M (PLN355M)
Note: Key issue for company remains rapidly emptying order book due to delays in public-sector IT tenders. Expected is a 19% jump in 2Q group sales due purely to consolidation of ABG unit in 3Q 05; on comparable basis, revenues are seen flat from year-earlier period.

Raiffeisen International (RIBH.VI): 1H Earnings
Average net profit (DJ, 6 analysts): EUR257.8M (EUR186M)
Average net interest income: EUR786M (EUR536M)
Average commission income: EUR390M (EUR180M)
Note: Analysts see CEE-loan growth and first-time 1H contributions from acquisitions as primary earnings-drivers. Net interest income is expected at +47% from the previous 1H. Commission income is seen more than doubling due mainly to the re-allocation of currency exchange fees. As a result, trading result is expected to drop to EUR59.2M from EUR124M.

Royal & Sun Alliance (RSA): 1H Earnings
Average operating profit (Co, 11 analysts): GBP351M (GBP329M)
Note: Analyst says he is looking for an update on the company's planned exit from the US

(MORE TO FOLLOW) Dow Jones Newswires

August 10, 2006 01:45 ET (05:45 GMT)

10 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Corporate Events -2-

RWE (RWE.XE): 2Q Earnings
Average net profit (DJ, 3 analysts): EUR671M (EUR452M)
Average sales: EUR10.58B (EUR9.71B)
Note: RWE Power unit seen the main earnings driver due to rising electricity prices, higher sales, increased upstream oil production at RWE DEA unit in light of high oil prices. Sales seen +9%. Analysts say earnings growth momentum still intact, but 2Q results are unlikely to match strong 1Q, which benefited from long, tough winter. Analysts expect company to reiterate FY 06 guidance. Focus also on expected impact of grid regulation in 2H, update on Thames Water sales process.

Sampo (SAMAS.HE): 2Q Earnings
Average pretax profit (DJ, analysts): EUR215M (EUR402M)
Note: 2Q pretax profit was mainly on weak investment income due to recent volatility on the equity and bond markets. Although there have been some large claims in the quarter, the underlying Nordic claims trend is expected to be positive. Eyes are on full year combined ratio guidance. Report due at between 0600-0700 GMT.

Securitas (SECU-B.SK): 2Q Earnings
Average pretax profit (SME Direkt, 14 analysts): SEK948M (SEK847M)
Note: Earnings are seen boosted by higher sales. The 2Q operating margin at Securitas' US surveillance business is seen rising to 5.0%, while the margin in Europe is seen unchanged at 7.0%. Analysts will closely eye any comments on the planned sale of Loomis.

Stada Arzneimittel (SAZ.XE): 2Q Earnings
Average net profit (DJ, 11 analysts): EUR19.4M (EUR15M)
Average sales: EUR283.9M (EUR247.9M)
Note: Analysts will watch out for the effect of German healthcare reforms in 2Q, and on more news about recent EUR485M acquisition of Serbian company Hemofarm and possible disposal proceeds coming with that acquisition. Full-year guidance of "continuing the long-term growth course and increase in earnings even stronger than in sales" is expected to be reiterated. Data due premarket Thursday.

Storebrand (STB.OS): 2Q Earnings
Average pretax profit (SME Direkt, 10 analysts): NOK255M (NOK389M)
Note: 2Q pretax profit was on low investment returns due to higher interest rates and recent equity market volatility. Analysts are watching Norwegian banking margins, outlook, as well as sales growth. Report due at around 0600 GMT.

Swedbank (FSPA-A.SK): 2Q Earnings
Average Operating profit (SME Direct, 18 analysts): SEK3.19B (SEK3.95B)
Note: 2Q operating profit a year earlier had benefited from a SEK810M capital gain from the sale of a 40% stake in EnterCard, as well as a positive SEK550M accounting effect. Net interest income is seen -5% with continued pressure on margins, although they are expected to have stabilized somewhat. Commission income is seen +12% at SEK2.06B. Eyes on margins, Hansabank operations. Report due at 0600 GMT.

Tecan (TECN.EB): 2Q Earnings
Average net profit (DJ, 3 analysts): CHF7.8M (CHF1.3M)
Average 1H net profit: CHF18.2M (CHF4.5M)
Average sales: EUR101.8M (N/A)
Note: 2Q net profit in year-ago period, when earning were hit by sharply higher costs and foreign currency hedging losses. 2Q sales seen 37% higher, boosted by the recent acquisition of REMP. Net profit will benefit from a lower tax rate compared to one year ago, while sequentially sales are likely to slow as a large 1Q order from the South African police falls away, says Zuercher Kantonalbank. Analysts eye REMP integration and company's ongoing effort to comply with FDA requirements.

TVN (TVN.WA): 2Q Earnings
Average consolidated net profit (DJ, 9 analysts): PLN78M (PLN71M)
Average sales: PLN286M (PLN218M)
Note: The bottom line to be negatively influenced by PLN11M costs of stock option program, but broadcaster to benefit from strong growth in advertising market, low 05 base.

(MORE TO FOLLOW) Dow Jones Newswires

August 10, 2006 01:45 ET (05:45 GMT)

10 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Corporate Events -3-

Acotel Group (ACO.MI): 2Q Earnings

AMB Generali Holding (AMB2.XE): 2Q Earnings

Aquarius Platinum (AQP.AU): FY Earnings

Basellandschaftliche (BLKB.EB): 1H Earnings

Bell Holding (BELN.EB): 1H Earnings

Bilfinger Berger (GBF.XE): 2Q Earnings

BorsodChem (BCHEM.BU): 2Q Earnings

CapMan (CPMBV.HE): 2Q Press conference

Cardo (CARD.SK): 1H Presentation

Concordia Maritime (CCOR-B.SK): 1H Earnings

Curanum (BHS.XE): 2Q Earnings

Egis (EGIS.BU): 3Q Earnings

Elexis (EEX.XE): 1H Earnings

Eltek (ELTK): EGM

Erg (ERG.MI): 2Q Webcast

Esr (7926.FR): 1Q Revenue

Fluxx.com (FXX.XE): 1H Earnings

ForeningsSparbanken (FSPA-A.SK): 2Q Earnings

GEA Group (G1A.XE): 2Q Earnings

Graphisoft (): 2Q Earnings

Heba Fastighets (HEBA-B.SK): 1H Earnings

Iberia (IBLA/MC): July Traffic Data

Incap (ICP1V.HE): 2Q Earnings

Investec (INVP.LN): AGM

Moevenpick Holding (MOV.EB): 1H Earnings

Navigazione Montanari (NN.MI): 2Q & 1H Earnings

Nemi Forsikring (NEMI.OS): 2Q Presentation

Nera ASA (NER.OS): EGM

Nipson Digital Printing (NDP.LN): 1H Earnings

Orkla (ORK.OS): 2Q Earnings

Palfinger (PAL.VI): 1H Earnings

Pohjola (PV.YY): 1H Earnings

Proha (ART1V.HE): 1H Press Conference

Salzgitter (SZG.XE): 1H Analyst meeting

SAS (SAS.SK): Analyst meeting

Smiths Group (SMIN.LN): Trading update

Spirent (SPT.LN): 1H Earnings

Stocks Convertible Trust (SKV.LN): FY Earnings

Telecomputing (TCO.OS): 2Q Earnings

TGS-Nopec (TGS.OS): 2Q 2006 Presentation

Trefoil (TREF.OS): 2Q Earnings

Univar (38880.AE): 1H Earnings

West LB (WDLB): 1H Earnings

(MORE TO FOLLOW) Dow Jones Newswires

August 10, 2006 01:45 ET (05:45 GMT)

10 Aug 2006 05:45 GMT =DJ EUROPEAN MORNING BRIEFING: Div Payments & Ex Div Dates

Alphameric (ALM.LN): 1H 2006 Dividend Payment Date

Reckitt Benckiser (RB.LN): 1H 2006 Ex-Dividend Date

VT Group (VTG.LN): FY 2005 Dividend Payment Date

(END) Dow Jones Newswires

August 10, 2006 01:45 ET (05:45 GMT)