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From DealingFloor:

** EUROPE: HEADLINES **
- Gold Rises in Asian Trade as U.S. Dismisses Letter From Iranian President
- Oil Rises After Iranian President’s Letter Fails to Address U.S. Concerns
- Spot Platinum Price Surges to Record for 2nd Day on Rising Investor Demand
- Investors Held $120 Billion in U.S. Commodities Last Month, Citigroup Says

** EUROPE: IN PLAY TODAY **

- Euronext shareholders will reject a merger with Deutsche Boerse on the ground of lack of information (WSJ).

- Degussa posted a 79% surge in 1Q profit to E129m on revenue up 21% to E2.74bln. The company warned it was unlikely to repeat the high growth rates of 1Q but nonetheless remains confident for FY.

- Lufthansa April traffic data. The airliner will try to improve on last month’s performance where it recorded a 0.4% rise in passenger traffic YoY.

- Adidas-Salomon posted a 37% rise in 1Q net income to E144m (E131m expected) on sales up 48% to E2.46bln (E2.33bln). The company is confident of reaching its targets “in 2006 and beyond”.

- Rio Tinto plans to introduce an efficiency program, which could potentially raise its net present value by billions (Australian Review citing the group’s CEO).

- UBS purchased Brazil-based Banco Pactual for $2.5bln, which has $18.6bln under management. UBS will pay $1bln now, and up to $1.5bln over 5 years.

- Swiss Re will raise $350m through a global offering of stock after its shareholders subscribed for a 50% share sale to fund the purchase of GE Reinsurance unit.

- KPN Q1 ahead of consensus and reiterate guidance for FY. Headline EBITDA E1206m vs cons 1156m, revs 3002m vs 2978m f/c; EBIT also very strong at E612m vs our E566m; 2006 FY: Revenue low single digit increase; EBITDA flat; Capex EUR 1.6 - 1.8bn; FCF EUR > 2bn

** US HEADLINES **

- JPMorgan’s Michael Barakos Buys Large Caps as Smaller Stocks Advance More
- Fed Forecasts, Wrong Before, Are Key to Pause in Interest-Rate Increases
- Investors Held $120 Billion in U.S. Commodities Last Month, Citigroup Says
- Business Spending to Drive U.S. Expansion as Consumers Slow, Survey Shows

** US AFTER HOURS **

Dell (-5.8% after ahours) cut its 1Q EPS guidance to $0.33 from $0.36-0.38 ($0.38 consensus), revenue should reach $14.2bln compared to a forecast of $14.2-14.6bln ($14.5bln consensus). The PC maker blamed price cut and expects current “measures to ultimately results in industry leading growth for the company.” Final results will be announced May 18.

** US: IN PLAY TODAY **

Reporting earnings today are, amongst others Cisco, Walt Disney and Symantec.

Wholesale inventories (16:00 CET) and ABC Consumer Confidence are on the macro calendar.

** ASIAN MARKETS **

Nikkei -0.58%; Kospi -0.06%; HSI -0.38%; Taiwan -1.14%; China 1.9%; India -0.73%; Thailand 0.4%; Australia 0.06%

** ASIAN HEADLINES **

- Asian Stocks Fall From Record; BHP, PetroChina Pace Drop on Lower Prices
- Excessive Yen Moves May Hurt Economy, Japan Finance Minister Tanigaki Says
- Samsung, Hynix Raise IPod Chip Prices For First Time This Year; Glut Eases
- Indonesian Central Bank Cuts Main Interest Rate for First Time Since July
-Sony Plans to Start Selling PlayStation 3 on Nov. 17 for as Much as $599
- Philippine Long Distance Telephone’s First-Quarter Profit Falls 7 Percent
- Sun Hung Kai Offering $1 Billion Shares in Placement; Stock Trading Halted
- Toyota Profit May Rise as Watanabe Speeds Up Production, Uses Fewer Parts
- Taiwan’s Quanta and Compal Shares Fall After Dell Misses Profit Forecast

Source: Tuesday Morning View From Europe