European Factors to Watch-Shares seen lower, focus on British election
(Adds company news, futures prices) LONDON, May 7 (Reuters) - European shares headed for a weaker start on Thursday, mirroring losses on Wall Street and in Asia, with a stronger euro following a global bond rout and concerns about Greece's debt situation prompting investors to stay cautious. Britain's FTSE 100 index will also be in focus as voters in the country get to decide on Thursday who they want to rule the world's fifth-largest economy in a tight election that could yield weak government, propel it towards a vote on EU membership and stoke Scottish desire for secession. Prime Minister David Cameron's Conservatives and Ed Miliband's opposition Labour Party have been neck and neck in opinion polls for months, indicating neither will win enough seats for an outright majority in the 650-seat parliament. At 0647 GMT, futures for the Euro STOXX 50, Germany's DAX and France's CAC were down between 0.7 percent and 0.9 percent. Contracts on Britain's FTSE index were down 0.5 percent. Traders said the euro's resilience, partly due to a surge in Bund yields , was weighing on sentiment. "The recent strength in the euro is likely to start taking some life out of equities given the inverse relationship the two have. Some traders are still hopeful the euro strength is only a flash in the pan but until we see a shift in trend, the near term momentum remains strong," IG analyst Stan Shamu said in a note. European equities were expected to mirror U.S. stocks, which ended weaker on Wednesday after U.S. Federal Reserve Chair Janet Yellen warned of high valuations, adding to anxiety about future interest rates, and a following a bond rout. U.S. Treasuries fell, weighed down by a global slide in government bond markets that pushed yields to 2015 peaks and large bond sales by Apple and Royal Dutch Shell. Investors will keep a close eye on Greece. European lenders on Wednesday dashed Greece's hopes for a quick cash-for-reforms deal in the coming days, leaving Athens in an increasingly desperate financial position ahead of a major debt payment next week. On the data front, strong domestic demand pushed German industrial orders up in March but weak demand from abroad weighed on the figures, suggesting a only modest start to the year for the manufacturing sector in Europe's largest economy. COMPANY NEWS: SIEMENS German industrial group Siemens fell short of market expectations with a 5 percent drop in quarterly industrial profit as an unexpectedly weak result at its digital factory unit compounded problems at its energy operations. BT GROUP BT posted a better than expected 3 percent rise in full-year earnings and raised its outlook for free cash flow after a strong finish to the year, when it connected a record 455,000 fibre broadband customers. ROCHE Swiss drugmaker Roche said the U.S. Food and Drug Administration (FDA) has granted breakthrough therapy designation for venetoclax for the treatment of people who have relapsed or refractory chronic lymphocytic leukemia with a genetic abnormality. REPSOL Spain's Repsol posted a 74 percent rise in first-quarter operating profit, adjusted for inventory effects, to 928 million euros ($1.05 billion), boosted by a weaker euro which more than offset the negative impact of low oil prices. E.ON Germany's largest utility E.ON posted another weak set of quarterly results, burdened by its ailing power plant business which it plans to spin off to focus on more promising areas such as renewables and power grids. COMMERZBANK Commerzbank's investment banking division saw a 40 increase in operating profit in the first quarter, driven primarily by a surge in debt and currency trading, the bank said on Thursday. ALCATEL-LUCENT Telecom equipment maker Alcatel-Lucent, which is set to be bought by larger rival Nokia NOK1V.HE, swung to a first-quarter net loss, hit by a slowdown in spending by key U.S. customers and the drag of lower-margin sales in China. ING GROEP The Netherlands' largest financial group reported stronger-than-expected first-quarter profit for its banking arm on Thursday, buoyed by both underlying growth and capital gains. MORRISONS Britain's No. 4 grocer on Thursday posted a deteriorating fall in underlying sales, further illustrating the tough turnaround task facing its new boss. BNP PARIBAS, KLEPIERRE The French bank said that it had placed 22 million shares it owned in shopping mall operator Klepierre at 39.60 euros each, raising 870 million euros. VEOLIA ENVIRONNEMENT The French water and waste group's first-quarter sales grew 8.5 percent to 6.3 billion euros as the weak euro boosted international revenue and capital gains lifted current net profit 88 percent to 212 million, the company said. ARCELORMITTAL Tthe world's largest steelmaker cut its forecast for the growth of global steel demand this year to between 0.5 and 1.5 percent after reducing its guidance for all regions except Europe. HEIDELBERGCEMENT Germany's HeidelbergCement posted a rise in core earnings by 29 percent in the first quarter as it benefited from a recovery of the construction industry in North America and the United Kingdom. ADECCO The company said its chief executive and chief financial officer would both leave the company, as it reported first-quarter profit that beat expectations. CONTINENTAL The German automotive supplier raised its sales guidance for 2015 on strengthening auto demand in core European markets and foreign-exchange rate effects. BASF The chemicals group agreed to sell parts of its pharmaceutical ingredients business to Swiss drug contract manufacturer Siegfried Holding for 270 million euros ($306 million), including assumed debt. ACCIONA Spanish builder Acciona is considering listing its renewable energy arm, with 8,000 megawatt capacity, Expansion reported without citing sources. CELLNEX, TALGO Shares in Spanish telecoms group Cellnex and train manufacturer Talgo are set to start trading after the two firms' initial public offerings (IPO). ZURICH INSURANCE The company said first-quarter net income attributable to shareholders was $1.2 billion, 4 percent lower than in the prior year. BEIERSDORF Germany's Beiersdorf on Thursday reported a bigger than expected rise in first-quarter core profit helped by demand for its products in Eastern Europe. RWE Norway's sovereign wealth fund, which owns almost 2 percent of RWE, has written to RWE's supervisory board demanding an exit from coal power, Manager Magazin reported, citing a spokeswoman for the fund. METRO Investment group Haniel plans to lower its stake in the retailer by almost a third as it is balancing its portfolio, though pledged to remain the largest shareholder in Metro. AREVA Struggling French nuclear power group Areva may sell mining assets and cut as many as 3,500 jobs, or 10 percent of its domestic workforce in a restructuring, newspaper Le Figaro said on Wednesday. GLAXOSMITHKLINE The company scrapped plans to float its HIV drug business on Wednesday and promised to pay a steady dividend for three years, setting out long-term growth targets after the biggest shake-up in its 15-year history. AXA AXAF.PA Europe's second-biggest insurer said on Wednesday its first-quarter revenue rose 10 percent, helped by the euro's weakness against other currencies. RIO TINTO Rio Tinto vowed to continue producing iron ore at full tilt, despite a 55 percent plunge in prices since the start of last year, underpinned by its forecast that China's steel demand will grow towards 1 billion tonnes. UNILEVER Consumer goods group Unilever said late on Wednesday that it had bought U.S. skincare brand Kate Somerville. VIVENDI, NUMERICABLE-SFR Vivendi said it has completed the sale of its remaining 20 percent stake in French telecoms group Numericable-SFR. NATIXIS The French bank reported a 6 percent increase in first-quarter net income with revenue growth across its main businesses. RANDGOLD RESOURCES Gold miner Randgold Resources said its first-quarter profit from mining fell 16 percent, hurt by lower gold prices and reduced production. MACROECONOMIC DATA/EVENTS (GMT) : DE Industrial Orders FR Industrial Output US Challenger Layoffs US Jobless Claims ------------------------------------------------------------------------------ MARKET SNAPSHOT AT 0535 GMT: LAST PCT CHG NET CHG S&P 500 2,080.15 -0.45 % -9.31 NIKKEI 19274.9 -1.31 % -256.73 MSCI ASIA EX-JP 502.23 -1.24 % -6.3 EUR/USD 1.1364 0.11 % 0.0013 USD/JPY 119.50 0.06 % 0.0700 10-YR US TSY YLD 2.234 -- -0.01 10-YR BUND YLD 0.609 -- 0.02 SPOT GOLD $1,187.00 -0.36 % -$4.30 US CRUDE $60.59 -0.56 % -0.34 > Asia slides, euro at 2-mth peak as bond rout rattles markets > Wall St ends lower on global bond rout, Yellen warning > Nikkei falls to 1-month low, hit by worldwide drop in bond prices > rices slip as bond markets sell off; 30-year yield tops 3 percent > Dollar struggles on soft data, sterling awaits election > Gold slips, stays below $1,200 as bond yields jump > London copper hovers below 2015-peak, soft dollar supports > Oil falls after hitting 2015 highs, markets still well supplied (Reporting by Atul Prakash; Editing by Sudip Kar-Gupta)
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