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Market Update

Weak German Confidence, Glencore Plunges 8%

Author: Nigel Thomas
Last Update: 2:10 PM ET September 15 2015

4:00 PM Frankfurt – European markets closed higher but German business confidence declined on the emerging markets export worries. Kingfisher profit surged 10%. Tele Columbus agreed to acquire rival Pepcom for €608 million. Deutsche Beteiligungs profit tumbled 29%. IQE net swung to profit. Saint Gobain sells the U.S.-based Norandex.

Markets in Europe closed higher but investors remained anxious ahead of the U.S. rate decision on Thursday.

Resource sector linked companies declined after coal and copper prices fell to lows not seen since the financial crisis of 2008-2010.

Glencore, the Switzerland-based commodities giant dropped as much as 9% in trading before recovering after copper and coal prices fell to six-year lows.

In addition, German utilities, E.ON and RWE declined after a report from Spiegel Online reported the companies fell short by as much as €30 billion in reserves to dispose of nuclear waste.

E.ON said the utility has sufficient reserves to deal with the waste disposal and nuclear power closures.

Germany has directed utilities to end nuclear power production and switch to alternative forms of energy.

In London trading, FTSE 100 index jumped 68.77 or 1.1% to 6,152.04 and in Frankfurt the DAX index rose 108.06 or 1.1% to 10,238.70.

In Paris, CAC 40 index increased 69.30 or 1.5% to 4,587.45.

Deutsche Beteiligungs Ag dropped 1.9% to €28.45 after the Germany-based investment company said net profit in the nine-month period ending in July tumbled 28.5% to €28.3 million compared to €39.6 million and diluted earnings per share decreased to €2.07 from €2.90 in the same period a year ago.

IQE Plc plunged 6.3% to 23.89 pence after the U.K.-based engineering consultancy services said revenues in the first-half ending in June increased 2% from a year ago to £53.2 million from £52 million.

Net in the period swung to profit from a year ago to £4.5 million compared to a loss of £5.8 million and diluted earnings per share swung to 0.65 pence from diluted loss per share of 0.92 pence.

Separately, the company agreed to acquire Silex Systems Limited’s subsidiary, Translucent Inc worth $1.5 million for the exclusive use of ‘Rare Earth Oxide’ semiconductor technology.

Kingfisher Plc slumped 2.7% to 350.30 pence after the U.K.-based home improvement products retailer reported sales in the first-half ending on August 1 declined 4.9% from a year ago to £5.38 billion from £5.61 billion.

Profit in the period surged 9.7% from a year ago to £328 million compared to £290 million and diluted earnings per share increased to 13.6 pence from 12.2 pence.

The retailer said retail profit decreased 2.1% to £410 million from £419 million in a year ago period.

Kingfisher said sales in U.K. and Ireland region jumped 4.6% to £2.53 billion and sales in France plunged 10.4% to £1.98 billion.

Compagnie de Saint Gobain SA jumped 2.1% to €41.24 after the France-based building materials producer agreed to sell its U.S.-based distribution business Norandex, to ABC Supply Co., Inc., a distributor of roofing and siding products for an undisclosed sum.

The transaction is expected to close in the fourth-quarter of this year.

Tele Columbus AG declined 4.3% to €11.49 after the Germany-based largest cable network operator agreed to acquire rival pepcom GmbH for €608 million or $689 million, including debt.

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