European Stock Futures Rise; BP, Total, BHP Billiton May Gain

By Sarah Thompson

July 11 (Bloomberg) -- European stock-index futures rose, following gains in the U.S. and Asia, after a report suggested the U.S. government may take over Fannie Mae and Freddie Mac and higher oil and metals prices boosted commodity producers.

U.S.-traded securities of BP Plc, Europe's second-biggest oil company, and Total SA advanced after crude jumped more than $5 a barrel yesterday. BHP Billiton Ltd., the world's largest mining company, and Rio Tinto Group gained in Australia.

Futures on the Dow Jones Euro Stoxx 50 Index, a benchmark for the euro region, added 23, or 0.7 percent, to 3,324 at 7:40 a.m. in London. The U.K.'s FTSE 100 Index may gain 30, according to CMC Markets.

U.S. officials are considering a plan to have the government take over one or both of Fannie Mae and Freddie Mac, the largest buyers of U.S. home loans, if they continue to deteriorate, The New York Times reported. The newspaper cited unidentified government officials briefed on the plan.

``News that Freddie Mac and Fannie Mae may be thrown a lifeboat will be very well-received by the markets,'' said David Buik, a London-based market analyst at BGC Partners. ``These companies have had investors asking some severe questions about their liquidity. Oil and mining stocks are also likely to rally.''

U.S. stocks rose yesterday, helping the Standard & Poor's 500 Index rebound from a two-year low, after Dow Chemical Co.'s agreed to buy Rohm & Haas Co. for $15.4 billion. Asian shares climbed today as commodity producers gained along with metals prices.

The cost of protecting Japanese and Australian bonds from default declined after the New York Times report.

BP, BHP

American depositary receipts of BP rose 1.3 percent from the close in London yesterday. ADRs of Total, Europe's third-largest oil company, ended 1.2 percent above the finish in Paris.

Oil for August delivery rose $5.60, or 4.1 percent, to $141.65 yesterday as Brazilian oil workers threatened a strike and on rising concern that supplies from the Middle East and Nigeria may be disrupted. It traded up 22 cents today.

Cadogan Petroleum Plc will probably gain. The oil and natural-gas producer operating in Ukraine said it found unexpected gas in its Borynya-3 well and reached its target depths in Pirkovskoe-1.

BHP jumped 3.4 percent in Australia, while Rio Tinto Group, the world's third-largest mining company, gained 2.7 percent.

Copper increased today in London while gold headed for a fourth weekly gain. Aluminum prices rallied as much as 6 percent to an all-time high of $3,380 a ton yesterday.

Nokia, Royal Bank

Nokia Oyj, the largest mobile phone maker, may gain. Nokia Siemens Networks won a contract valued at 550 million euros ($868 million) to expand the nationwide network belonging to China Mobile Communications Corp. Nokia Siemens, the world's second-biggest maker of wireless networks, is a joint venture between Nokia and Siemens AG.

Royal Bank of Scotland Group Plc might be active. The company, seeking to restore capital depleted by writedowns, is in talks to sell assets in Australia and New Zealand to National Australia Bank Ltd.

Mitchells & Butlers Plc may rise. UBS AG upgraded shares of the owner of O'Neill's pubs to ``buy'' from ``neutral.''

Zurich Financial Services AG might gain. Switzerland's biggest insurer pulled out of bidding for Royal Bank of Scotland's insurance unit and agreed to buy a 50 percent stake in Banco Sabadell SA's insurance units to become Spain's second- largest insurer.

Casino, Vodafone

Casino Guichard-Perrachon SA might advance. The biggest supermarket owner in Paris raised second-quarter sales by 15 percent after taking control of its Colombian and Dutch units and drawing French shoppers back to its discount stores.

Vodafone Group Plc is likely to fall. Thee world's biggest mobile-phone company may have to pay more than $4 billion in taxes if it loses a court case with the Indian government, the Financial Times reported.

Heineken NV will probably fall after the largest Dutch brewer was downgraded to ``underweight'' from ``overweight'' at JPMorgan Chase & Co., which cited the risk this year's acquisition of Scottish & Newcastle Plc assets may hurt earnings.

``Heineken offers half the medium-term growth rate of its brewing peers but is on a similar multiple and carries more forecast risk,'' JPMorgan analysts Mike Gibbs and Vanessa Lai Min wrote in a note dated today.

European Aeronautic, Defence & Space Co. might be active. The company doesn't rule out cutting the full-year earnings forecast when it releases six-month figures, Boersen-Zeitung reported, citing Chief Financial Officer Hans Peter Ring.

C&C Group Plc might slide. The Irish beverage maker whose shares plunged 70 percent in 2007 said sales continued to decline in the current fiscal year's first four months as Britons drank less Magners cider.

To contact the reporter on this story: Sarah Thompson in London at sthompson17@bloomberg.net.