This Morning's Top Euro Stories
LONDON -- European stock markets are trading higher Tuesday, ending a four-day slide as the EU drew up the blueprint for Spain's 100 billion euro bailout, the first 30 billion euros of which should reach Madrid by the end of the month. In addition, better-than-expected manufacturing data in the U.K. and Italy released this morning has helped increase optimism.
Gains come despite Chinese import data overnight showing falling demand from the world's biggest consumer of raw materials -- signs taken by most that the country's economic growth outlook is continuing to cool. In Europe, the German DAX (INDEX: ^GDAXI) is putting in a solid performance, up 1.2%.
Steelmakers are one of the best-performing industries across the continent today, helped as news over falling Chinese iron ore imports offers some hope that the costs of this key steelmaking material may be under pressure in the coming months. The data showed that iron ore imports fell 9% between May and June to 58.3 million tons, and hopes now flourish that the reduction in this core cost will help improve profitability for companies such as ThyssenKrupp (NASDAQOTH: TYEKY.PK), which is up 4.3% today after Macquarie Group raised its recommendation for the company.
Italian manufacturer Finmeccanica (NASDAQOTH: FINMY.PK) is also making good gains today, up around 4.6% amid upbeat news for defense-related firms. Just days after the U.K. ruled out further cuts to defensive-equipment programs, Lockheed Martin said the Dutch vote against an order for its F-35 Joint Strike Fighter has not put an end to the deal as a whole.
Elsewhere, and despite some positive news for banks today, the finance sector is seeing rather mixed trade across Europe. News that the EU banking watchdog will tomorrow publish a report suggesting that European banks will be able to meet their capital requirements has actually been offering little support this morning, particularly for banks in the peripheral European countries.
Of these, the National Bank of Greece (NYS: NBG) is leading losses, down almost 6% on reports that it's trying to form a "megabank" with Piraeus Bank, Credit Agricole, and Emporiki Bank. The company has strongly denied these rumors, however.
In addition, NBG is said to be interested in buying the so-called "good bank" business of the Agricultural Bank of Greece, which may be split, according to a report in the Greek paper Kathimerini today.
On the corporate front, French company Sodexo (NASDAQOTH: SDXAY.PK), the world's second-largest provider of catering services, is making some of the sharpest losses in Paris, down more than 4.7% after it reported a disappointing sales outlook to the market.
The company said deteriorating economic conditions caused sales growth to slow in the latest quarter. Sales increased just 5.2% for the first nine months of its accounting year, compared with the 6.4% growth it reported for the first six months. The move has not led the company to change its guidance of 6% to 7% organic sales growth for the year, however, though it did now suggest that this would be "challenging."
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