European stocks ended higher on Friday, as buoyant pharmaceutical shares eclipsed a drop in cyclical mining and industrial sectors hit by renewed economic fears, while energy shares tumbled along with oil.

The FTSEurofirst 300 index of top European shares closed 1.1 percent higher at 862.07 points.

Although it gained 13 percent during the week, the index dropped 7 percent in November, recording a ninth month of losses in what has been a torrid 2008 for equities worldwide.

Pharma stocks made strong gains on Friday, with GlaxoSmithKline up 5.1 percent and Sanofi-Aventis up 4.5 percent. Novartis , whose CEO said the company could increase its dividend and also resume share buybacks once it has reduced its debt, gained 4.4 percent.

The sector rallied after the publication of a long-anticipated EU report on generic competition. Although Competition Commissioner Neelie Kroes said preliminary results showed competition in the pharmaceuticals industry “does not work as well as it should”, traders said the absence of specific penalties in the report brought some relief to pharma stocks.

Energy firms such as Total and BP dropped 0.7-2.6 percent as oil prices sank below $52 a barrel on signs OPEC would defer cutting production when it meets this weekend in Cairo.

Industrials were also among the biggest losers, with Siemens down 3.8 percent and Alstom down 6 percent.

Despite the market’s recovery during the week, analysts remain wary about a potential “Christmas rally” this year.

“The volatility is not about to come down immediately. The economic newsflow is just too horrible. It’s too early to call for a straight market rally at this point,” said Arthur van Slooten, strategist at Societe Generale, in Paris.

“With deflation fears, risky assets have been pricing in the worst. But it doesn’t mean that all of a sudden, from now on you have a straight way up. We know that the newsflow will be terrible, but we need at least some sort of indication that the bottom is maybe in sight,” he said.

“Next year’s first quarter will really look awful in terms of macro data and with analyst further downgrading their estimates and companies finally becoming realistic in their own guidance. That in itself could provide us with a sound basis to build from there.”

Miners took a beating on Friday, adding to recent sharp losses. Anglo American shed 2.4 percent and Xstrata dropped 3 percent.

Prices for copper, a key industrial metal, slipped as tumbling industrial production data from Japan highlighted bleak prospects for demand in an oversupplied market, while prices for aluminium also fell, hit by the rising fears about the health of the embattled auto sector.

“There is little doubt that the outlook for metals demand is grim for at least the next few quarters and prices have fallen to levels that reflect market expectations for further stock increases,” Barclays Capital said in a note.

Automakers lost ground, with Volkswagen down 5 percent, BMW off 3.4 percent and Renault down 4.8 percent.

“Going into the weekend, one can’t help but worry that we are only a heartbeat away from the next scare story,” said Chris Hossain, senior sales manager at ODL Securities.

“The markets appear to have been buoyed by the feeling that the U.S. will be bailing out the auto industry, but one has to wonder how much more the global governments can continue to support troubled industries,” he added.

Around Europe, Germany’s DAX index eked out a gain of 0.1 percent, UK’s FTSE 100 index rose 1.5 percent and France’s CAC 40 added 0.4 percent.

By Blaise Robinson
PARIS, Nov 28 (Reuters)

• Sales of existing homes fell 3.1% in October, the lowest drop in four years, Reuters reported. Over the past year, medium home prices also declined 11.3% to $183,300, the biggest percentage drop since the National Association of Realtors began keeping records in 1968.

• Chile’s gross domestic product beat forecasts and grew 4.8% in the third quarter. Domestic demand was strong, as was energy output. “These figures surprised the market and showed that the Chilean economy is surprisingly resistant to a rapid deceleration,” Juan Pablo Castro, an economist at Banco Santander SA in Santiago, told Bloomberg. “Consumption is still growing at around 6 percent even though you’d expect to see the effects of inflation and interest-rate rises.”

• Shares of Solar power manufacturer SunPower Corp. (SPWRA) jumped yesterday after the company announced it had completed an 18-megawatt solar electric power plant in Badajoz, Spain. The plant’s SunPower Tracker follows the sun as it moves across the sky, increasing sunlight capture by up to 30% more than conventional fixed-tilt systems.

• China oil titan Cnooc Ltd. (CEO) and undisclosed partners may spend up to $29 billion to develop deposits in the South China Sea. The state-run oil company is making a big push to feed domestic energy demand as well as put its flag in an oil-rich aquatic area where its facing exploration competition from Vietnam and Indonesia, Bloomberg reported.

• Alpharma Inc. (ALO) yesterday (Monday) agreed to King Pharmaceuticals Inc.’s (KG) $1.6 billion cash takeover offer. The deal values Alpharma at $37 a share – a 54% premium to the company’s closing price on Aug. 21, the last trading day before King’s initial $33-per-share bid.

• Xerox Corp. (XRX) yesterday (Monday) said that 2009 profits are generally in line with analyst expectations and that its strong contingent of repeat customers coupled with cost cuts will help it weather the economic downturn. The company, which last month said it plans to cut about 3,000 jobs, or 5% of its work force, expects 2009 profit to range between $1 a share to $1.25 a share.

• The price of crude oil yesterday (Monday) rose $4.57 a barrel, or 9.15%, to settle at $54.50 a barrel on the New York Mercantile Exchange. Oil climbed more than $5 earlier in the day, reaching a session high of $55.30 a barrel on hopes that equity markets will continue to recover.

Source: Global Investing Roundups, Tuesday, November 25th, 2008

• Carlos Slim, the Mexican billionaire Forbes ranks as the second-richest man in the world, yesterday (Thursday) announced he purchased a 6.4% stake in New York Times Co. (NYT). Slim called the publisher of The New York Times an “attractive value” due to the stock’s 20% loss so far this year, Bloomberg News reported.

• Campbell Soup Co. (CPB) yesterday (Thursday) announced quarterly profit for its fiscal fourth quarter ended Aug. 3 increased 46% from the year ago period as the company increased prices to offset higher commodity costs. Campbell’s reported net earnings of $89 million, or $0.24 per share, compared to $61 million, or $0.16 per share for the prior year in a company statement.

• King Pharmaceuticals Inc. (KG) upped its takeover offer for Alpharma Inc. (ALO) yesterday (Thursday) to almost $1.6 billion. King raised its offer to $37 per share from its initial bid of $33 per share and said it plans to take the new offer directly to shareholders, Reuters reported.

• According to a report published yesterday (Thursday) by the Commodity Futures Trading Commission, commodity index traders only accounted for 13% of crude oil futures trading on the New York Mercantile Exchange in the first half of 2008, Bloomberg News reported. “At first glance the numbers seem inconsistent with the allegations that swaps traders and index traders are driving up the price of oil,” said Robert Webb, a finance professor at the University of Virginia.

• Bank of America Corp. (BAC) is in talks to buy Lehman Brothers Holdings Inc. (LEH), the Wall Street Journal reported, citing an unnamed source. Sources say Goldman Sachs Group Inc. (GS), also thought to be interested, will not takeover the beleaguered firm.

• Bristol-Myers Squibb Co. (BMY) yesterday (Thursday) reiterated its $60 per share offer for ImClone Systems Inc. (IMCL), even though the biotechnology company said earlier this week that a secret suitor is offering $10 a share more.

• Shares of Sunrise Senior Living Inc. (SRZ) yesterday (Thursday) reported a $31.8 million second-quarter loss. The company’s shares fell $2.56, or 13.5%, to close at $16.36 after falling as low as $16.22 earlier in the day. On Wednesday, the stock fell $1.82, or 8.8%.

• Deutsche Bank AG (DB) will today (Friday) announce the purchase of a controlling stake in Postbank, a profitable German institution worth about $14.6 billion, the International Herald Tribune reported. This opens up the door for a potential bidding war with Banco Santander SA (ADR: STD), which said Thursday that it wanted to negotiate the purchase of all of Postbank.

Source: Global Investing Roundups Friday, September 12th, 2008