European Stock-Index Futures Rise; SocGen, UBS May Advance

By Adam Haigh

Oct. 17 (Bloomberg) -- European stock-index futures rose, indicating the Dow Jones Stoxx 600 Index will rebound from its steepest two-day retreat since 1987, on a possible government plan to bailout U.S. bond insurers and better-than-estimated earnings from Google Inc. U.S. index futures and Asian shares gained.

Societe Generale SA and UBS AG may advance after Ambac Financial Group Inc., the world's second-largest bond guarantor, said it will present a rescue plan to the Treasury Department. Carrefour SA and Kesa Electricals Plc may be active after Goldman Sachs Group Inc. added the shares to its ``conviction buy'' list.

``We are seeing more positive sentiment after the U.S. gains last night,'' said Matt Buckland, a trader at CMC Markets in London. ``Google's figures were really good and this is helping sentiment not just in the technology sector. Everyone is breathing a sigh of relief after a tricky week.''

Futures on the Euro Stoxx 50, a benchmark for the euro region, added 134, or 5.6 percent, to 2,544 at 7:08 a.m. in London. The U.K.'s FTSE 100 Index is set to open 187 points higher, according to IG Markets.

U.S. stocks rose for the first time in three days yesterday as oil's retreat below $70 a barrel sparked a rally in consumer companies. Financial shares and utilities led Asian markets higher today on signs governments are succeeding in efforts to unlock credit markets.

Concern the seizure in credit markets will trigger a global recession erased $27 trillion in value from stocks worldwide, dragging the Stoxx 600 down 43 percent this year. Financial firms reported $654 billion in losses and writedowns from mortgage-related investments since the beginning of 2007.


Gains, Losses

The Stoxx 600 has gained 0.6 percent so far this week, headed for its first weekly gain in five. The measure rallied 13 percent in the first two days this week, its biggest two-day surge on record, as central banks and governments injected $2 trillion to bailout banks and unlock the credit market.

Reports this week showed declining U.S. retail sales and U.K. unemployment climbing to the highest in since November 2006, driving shares lower in the past two days with the Stoxx 600 posting its biggest two-day drop since the market crash of 1987.

American depositary receipts of Societe Generale climbed 6.3 percent above yesterday's close in Paris. UBS added 3.3 percent from its closing price in Switzerland.

Ambac Chief Executive Officer Michael Callen said it is working with other bond insurers on a plan to send to the U.S. Treasury that would enable them to sell troubled assets to the government.

Google

Google, owner of the most popular Internet search engine, reported profit that topped analysts' estimates, saying customers are still buying Web ads even as the economy slows.

Carrefour, Europe's largest retailer, and Kesa Electricals, the owner of France's Darty electronics stores and Britain's Comet chain, may be active. Goldman Sachs added the shares to its ``conviction buy'' list citing recent share price declines.

Saab AB may be active after the Swedish maker of the Gripen fighter plane reported a third-quarter net loss as customers delayed military projects and orders, prompting the company to deepen its planned cost cuts and eliminate 500 jobs.

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net