European Stocks Fluctuate; Siemens Declines, BNP Paribas Gains

By Sarah Jones

Sept. 29 (Bloomberg) -- European stocks fluctuated between gains and losses as Siemens AG said that fiscal 2009 was a “tough” year, offsetting an advance by BNP Paribas SA after the bank said it will raise capital to repay government funds.

Siemens, Europe’s largest engineer, slipped 2.7 percent in Frankfurt after Chief Financial Officer Joe Kaeser made the comments to investors at a meeting in London. Salzgitter AG slid 2.5 percent as Germany’s second-biggest steelmaker announced a convertible-bond sale. BNP Paribas SA added 2.3 percent after France’s largest bank said it will seek to raise 4.3 billion euros ($6.3 billion) in a rights offer.

Europe’s Dow Jones Stoxx 600 Index decreased less than 0.1 percent at 11:03 a.m. in London after climbing as much as 0.3 percent and falling as much as 0.4 percent. The regional gauge added the most in five weeks yesterday. The MSCI Asia Pacific Index rose 1 percent today as the dollar advanced against the yen, boosting Japanese automakers and electronics companies.

“Whether you are overweight equities or not overweight, in either case you are a little nervous and perhaps don’t sleep quite so well,” Monika Rosen, Vienna-based head of research at UniCredit Private Bank, said in a Bloomberg Television interview. “The markets have however shown themselves remarkably resilient, certainly more so than I would have expected.”

Standard & Poor’s 500 Index futures fell 0.1 percent after the benchmark gauge for U.S. equities rose the most in five weeks yesterday. Reports today on home prices and consumer confidence may add to evidence the recession is abating.

Valuations, Siemens

Equity indexes in the U.S. and Europe have rebounded more than 50 percent since March, sending price-earnings valuations on the S&P 500 and the Stoxx 600 this month to the highest levels since 2004 and 2003, respectively.

Siemens dropped 2.7 percent to 64.17 euros after Kaeser said that order bookings in the year that ends this month will fall.

Salzgitter slipped 2.5 percent to 66.75 euros after the steelmaker said it will sell about 300 million euros of convertible bonds and use the proceeds for “general” purposes and to diversify its funding.

BNP Paribas rose 2.3 percent to 57.85 euros after the Paris-based lender said it will seek to raise capital to help repay the government.

The bank is offering existing investors 107.6 million shares at 40 euros each, or 29 percent below yesterday’s closing price. BNP will repay 5.1 billion euros it received from the French state as well as 226 million euros of interest.

Independent Newspaper

Independent News & Media Plc sank 7.4 percent to 25 euro cents after the publisher of the U.K.’s Independent newspaper said it will give bondholders a 46 percent stake in the company as part of a restructuring of its debts. The company will swap 123 million euros of the money owed to bondholders for the stake. The deal follows months of negotiations on a restructuring of its debts.

MTU Aero Engines Holding AG dropped 3.4 percent to 32.60 euros after HSBC Holdings Plc downgraded the German engine maker to “neutral” from “overweight,” saying in a report to clients that a weaker dollar “bears earnings risk.”

Compass Group Plc rallied 3.1 percent to 370.6 pence after the world’s largest catering company said it is performing well in the fiscal fourth quarter. The company expects margin growth of around 70 basis points in the period ending Sept. 30 and 60 basis points in the full year.

Umicore SA jumped 2.6 percent to 29.78 euros after Citigroup Inc. upgraded the world’s largest precious-metals recycler to “buy” from “hold,” citing increasing mergers and acquisitions in the chemical industry.

U.S. Economic Reports

U.S. economic reports today may show home values in 20 U.S. metropolitan areas declined at a slower pace and consumer confidence improved, according to economists.

The S&P/Case-Shiller home-price index fell 14.2 percent in July from a year earlier, the least in 17 months, according to the median forecast of 35 economists surveyed by Bloomberg News. The Conference Board may say its gauge of consumer sentiment rose this month to the highest level in a year.

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