European Stocks, U.S. Futures Gain; SocGen, Air France, GM Rise

By Sarah Jones

Aug. 5 (Bloomberg) -- European stocks rose for the first time in four days after Societe Generale SA and Air France-KLM Group reported better-than-estimated earnings, stoking speculation profit growth will withstand the economic slowdown. U.S. index futures gained, while Asian shares fell.

Societe Generale, France's second-largest bank, climbed to a two-month high as writedowns slowed. Air France jumped the most in three weeks after Europe's largest airline reaffirmed its profit forecast, and Daimler AG and General Motors Corp. rallied in Germany as oil fell to a three-month low. Adidas AG gained after the sporting-goods maker raised its projection for profit margins.

The Dow Jones Stoxx 600 Index advanced 2 percent to 283.26 at 1:42 p.m. in London, while futures on the Standard & Poor's 500 Index added 0.7 percent before the Federal Reserve announces its decision on interest rates. The MSCI Asia Pacific Index slid 0.9 percent, led by declines in commodity producers.

The earnings reporting season ``hasn't been as disastrous as people had thought,'' said James Buckley, a London-based director at Baring Asset Management, which oversees about $48 billion. ``We have seen a sharp decline in energy prices and commodities prices, which is also supporting the broader equity market.''

Energy and raw-materials stocks fell into bear markets yesterday, commonly defined as a slump of 20 percent or more, after plunging oil, gold, copper and wheat prices spurred declines in last year's best-performing industries. Exxon Mobil Corp., OAO Gazprom, and StatoilHydro ASA all sank more than 19 percent from records as crude prices tumbled.

Writedowns

The Stoxx 600 has retreated 22 percent in 2008, led by HBOS Plc and UBS AG, as banks' credit losses and asset writedowns topped $480 billion worldwide, helping spur analysts to reduce earnings estimates.

Profits at Stoxx 600 companies may drop 2.5 percent on average in 2008, according to projections tracked by Bloomberg. That's down from a forecast for 11 percent growth in January.

National benchmark indexes increased in all 18 western European markets except Norway and Austria. France's CAC gained 1.7 percent and Germany's DAX jumped 2.4 percent. The U.K.'s FTSE 100 climbed 1.9 percent as Standard Chartered Plc reported higher profit and Wolseley Plc surged.

Societe Generale climbed 8.1 percent to 64.29 euros. The bank reported a 63 percent decline in second-quarter profit to 644 million euros ($1 billion), more than the 550 million-euro median estimate in a Bloomberg survey. The company reported 575 million euros of markdowns on subprime-infected debt, less than half the level of the first quarter.

Standard Chartered

Standard Chartered jumped 4.6 percent to 1,488 pence after the U.K. bank that earns most of its money in Asia said first- half profit climbed 31 percent to $1.79 billion, helped by corporate lending in India and Hong Kong.

Barclays Plc added 7.7 percent to 365.5 pence after the U.K.'s third-biggest bank agreed to sell its U.K. life insurance unit to Swiss Reinsurance Co. for 753 million pounds ($1.5 billion) as it seeks to fund expansion in fast-growing overseas markets.

Air France gained 7.4 percent to 17.46 euros, the highest since May. First-quarter profit totaled 168 million euros, beating analysts' estimates of 152 million euros.

Chief Executive Officer Jean-Cyril Spinetta reaffirmed his forecast of May that fiscal-year earnings before interest and taxes will drop 30 percent.

Airlines and carmakers were also buoyed by lower oil.

Ryanair Holdings Plc, Europe's biggest discount carrier, jumped 14 percent to 2.56 euros. British Airways Plc, the region's third-largest airline, climbed 6.4 percent to 271.25 pence. Merrill Lynch & Co. also upgraded the shares to ``buy'' from ``underperform.''

Daimler, GM

Daimler, the world's second-biggest maker of luxury cars, rallied 5.1 percent to 38.87 euros. GM, the largest U.S. carmaker, climbed 27 cents to $10.37 in Germany.

Crude oil for September delivery declined as much as $3.41, or 2.8 percent, to $118 a barrel on the New York Mercantile Exchange.

BP Plc, Europe's second-biggest oil company, dropped 1.4 percent to 511 pence. Total SA, Europe's third-largest energy company, declined 2.2 percent to 47.22 euros.

Adidas rose 6.5 percent to 40.87 euros after the world's second-largest sporting-goods maker reported a 12 percent increase in second-quarter profit to 116 million euros, beating analysts' estimates. The company also raised its forecasts for annual profit margins.

Carlsberg, Wolseley

Carlsberg A/S rallied 15 percent to 437 kroner. The Nordic region's largest brewer said second-quarter profit rose 36 percent to 1.42 billion kroner ($296 million) after April's joint takeover of competitor Scottish & Newcastle Plc with Heineken NV. That beat the 1.28 billion-krona median estimate of eight analysts surveyed by Bloomberg.

Wolseley jumped 13 percent to 398.25 pence, the biggest gain on the FTSE 100, on speculation the world's largest distributor of plumbing and heating equipment may sell its U.S.- based Stock Building Supply division.

Rumors that Stock may be sold ``have been around for two to three weeks and there has been more steam in the last couple of days,'' Kevin Cammack, an analyst at London Kaupthing, said by phone today.

Michael Page International Plc soared by a record 35 percent to 358 pence after the U.K.'s second-largest recruitment firm said it received a takeover approach from Adecco SA of Switzerland.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.