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Market Update

European Markets Brush Off Italy’s Referendum Rejection

Author: Sarla Buch
Last Update: 10:00 AM ET December 05 2016

4:00 PM Frankfurt – Italian market index recovers from the early sell off. Air Berlin sold its stake in NIKI to Etihad on €300 million. UniCredit is in exclusive talks to sell its Pioneer Investments to France-based Amundi for €4 billion. Panasonic is in the final stages of talks to acquire ZKW for $1 billion.

Financial markets in Europe surprisingly were muted as Italian voters rejected constitutional reformed pushed by the Prime Minister Matteo Renzi.

Italian market index dropped as much as 2.4% after Prime Minister Renzi resigned on Monday morning but by early afternoon the index recovered most of its losses.

In London trading, FTSE 100 index rose 17.72 or 0.3% to 6,748.44 and in Frankfurt the DAX index jumped 134.61 or 1.3% to 10,648.10.

In Paris, CAC 40 index increased 37.39 or 0.8% to 4,566.21.

Air Berlin Plc gained 1.7% to €0.59 after Germany-based airline group sold its entire stake in NIKI Luftfahrt GmbH to Etihad Investment Holding Company LLC for about €300 million.

“We are delivering a decisive step towards our new strategy, and transforming airberlin into a network carrier focused on domestic and European traffic,” chief executive officer airberlin Stefan Pichler said.

Burberry Group Plc gained 1.4% to 1,432 pence after Financial Times reported luxury goods wholesaler and retailer rejected multiple “cash-and-stock” takeover offers from the U.S.-based handbag maker Coach Inc.

Cambian Group Plc jumped 5.3% to 137.70 pence after the U.K.-based behavioral health services provider said plans to sell its adult services business to a unit of the U.S.-based Universal Health Services Inc for £377 million pounds or $478 million in cash.

The transaction is expected to close before the end of this month.

UniCredit SpA plunged 6.2% to €1.96 after Italy-based banking and financial services provider is in exclusive talks to sale of its Pioneer Investments to France-based Amundi for up to €4 billion.

Under its new strategic plan, UniCredit may include a share sale worth about €13 billion or $13.74 billion.

Volkswagen AG advanced 2.1% to €121.25 and Germany-based automobile company today officially launched its new mobility services at the industry event.

“MOIA will help us gain a deeper understanding of new forms of mobility and how to make them even more attractive in future,” chief executive officer the Volkswagen Group Matthias Müller said.

The ZKW Group, the Nikkei business daily reported that Panasonic Corp is in the final stages of talks to acquire the U.K.-based privately held light-emitting diode headlights maker for up to $1 billion.

ZKW forecasted sales in fiscal 2016 of about €900 million or $949.59 million.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc