AMERICAN MARKETS OUTLOOK: U.S. stock markets are expected to open higher Monday as early futures trading is pointing upward, as are most European indexes, while oil futures are a little lower.
Finspreads in London is calling the Dow Jones Industrial Average to open up 25 points at 11086, the S&P up three points at 1292.4, and the Nasdaq up seven at 1673.
As on Friday, the S&P 500 still looks as if it is shaping a double top, but with a good start in Europe and futures moving higher better trading is expected Monday. Angus Campbell at Finspreads said that for the S&P, 1294 remains the level to be breached. This level has attracted plenty of selling in the past and a close above it could lead to higher prices.
EUROPEAN MARKETS: European markets are mostly higher.
In London, a buoyant utilities sector more than offset losses from telecommunication stocks after Vodafone Group said it would write down as much as GBP28 billion in goodwill. Vodafone shares slipped 3.4% in heavy trading after the announcement. The FTSE 100 is up 0.3% at 5878. In Frankfurt, Deutsche Telekom is down 0.9% following the Vodafone news, while the overall DAX is 0.3% higher at 5885. The CAC is down 0.1% at 5066.9
Bunds and gilts are lower on the softer tone in Treasurys and stronger-than-forecast euro-zone M3 money supply data. M3 rose 7.6% in January with the three-month average at 7.5%, both above Dow Jones Newswires forecasts of 7.3% and 7.4%, respectively. Economists said it was significant that no slowdown in money supply and credit has been registered since December's rate hike and that the European Central Bank will use the figures to justify a second rate hike Thursday. The March bund future is down 0.24 at 120.12, while March gilts are down 0.30 at 113.56.
The dollar is mixed but is still expected to get help from expectations of further U.S. rate rises. The euro is down at $1.1847, the dollar is weaker against the yen at Y116.15, and the pound has softened to $1.7390.
EURO-ZONE MONEY SUPPLY UP IN JANUARY: Money supply in the euro zone shot up in January from December, providing the European Central Bank with more reason to raise interest rates, as expected, at a policy meeting Thursday. (Data Snap by Monica Houston-Waesch)
EU: AWAITING CONFIRMATION OF RUSSIA/IRAN URANIUM DEAL: European Union officials said Monday they were awaiting confirmation of a preliminary deal between Iran and Russia to establish a joint uranium enrichment venture. (AP)
SUEZ, GdF APPROVE ONE-FOR-ONE SHARE MERGER: Suez SA (12052.FR) and Gaz de France (1020848.FR) said Monday that their boards have approved an all-share, one-for-one merger - a deal that will create one of the world's largest utilities with a combined market value of around EUR70 billion. (News Snap by Brian Lagrotteria)
ARCELOR CONTINUES ANTI-MITTAL CAMPAIGN: Arcelor SA (5786.FR) continued its campaign against the bid from Mittal Steel Co NV (MT) with a strategic plan that promised stronger returns to shareholders. (News Snap by Gren Manuel and Juliane von Reppert-Bismarck)
VODAFONE CUTS MEDIUM-TERM FORECASTS: Vodafone Group PLC (VOD) slashed its own forecasts for its medium- and long-term growth, triggering an impairment charge of at least GBP23 billion and possibly as much as GBP28 billion. (News Snap by Gren Manuel)
NIPPON SHEET GLASS TO BUY PILKINGTON: Nippon Sheet Glass Co. (5202.TO) said it will buy all shares in Pilkington PLC (PILK.LN) it doesn't yet own in a friendly takeover deal that values the U.K. glass maker at around GBP2.25 billion. (By Kazuhiro Shimamura)
INSIGHT & ANALYSIS FROM DOW JONES NEWSWIRES:
=FOREX FOCUS: Last Friday's KOF survey should give the Swiss franc just the lift many have been looking for. But not all forecasters are convinced that the currency will have enough momentum to lift it out of recent ranges. (By Nicholas Hastings)
=THE SKEPTIC: All dressed up and somewhere to go - good news for House of Fraser investors, at last. Private equity firm Apax Partners is apparently attempting to negotiate an agreed deal with the HoF board that could value the sixty-strong department store group in excess of GBP300 million. (By Howard Wheeldon)
STILL TO COME
1000/1500 US Jan New Home Sales
1030/1530 US Feb Dallas Fed Mfg Production Index
Alliance & Leicester PLC (AL.LN) said full-year net profit fell 7.4% on rising bad debt, but the bank also said it had cut costs and gave a positive outlook. (News Snap by Sarah Spikes)
National Grid PLC (NGG), the U.K. electricity grid operator, said it is still in the market to expand further in the U.S. and Europe after acquiring the fifth-largest U.S. natural gas distributor, KeySpan Corp, for $7.3 billion in cash. (News Snap by Alex MacDonald)
Air Liquide SA (12007.FR) said the solid performance of its hydrogen business and an improved contribution from Germany's Messer Griesheim acquired in 2004, helped lift 2005 net profit 19.7%. (News Snap by Digby Larner)
U.K. mortgage lending in January eased back to the recent trend level from December's high, but it was the strongest January total on record, suggesting the housing market continues to be robust. (Data Snap by Ilona Billington)
Pearson PLC (PSON.LN), the U.K. school books-to-newspaper publisher, posted a 21% rise in adjusted pretax profits for the full year, underpinned by a strong year at its U.S. education unit. (News Snap by Jessica Hodgson)
South-African-based insurer Old Mutual Plc (OML.LN) reported a better-than-expected operating profit for 2005 and said it expects to spur profitable growth in the years ahead. (News Snap by Goran Mijuk)
Grupo Ferrovial SA (FER.MC) said its 2005 net profit dropped more than 21%, hit by a difficult comparative base from one-off capital gains from asset sales conducted in 2004. (News Snap by Santiago Perez)
Bunzl PLC (BNZL.LN, BNL) reported a 16% rise in full year pretax profit, and said it expects to grow organically in the coming year with help from recent acquisitions. (News Snap by Henry Teitelbaum)