Monday Morning View From Europe

by: Dealing Floor

From DealingFloor:

** EUROPE: UPS & DOWNS **

+ ALSTOM PRICE ESTIMATE RAISED 14% TO EU74 AT CREDIT SUISSE
+ ITV RAISED TO `EQUAL-WEIGHT’ AT MORGAN STANLEY
+ EUROPEAN AIRLINE STOCKS RAISED TO `NEUTRAL’ AT GOLDMAN SACHS
+ VESTAS PRICE ESTIMATE RAISED TO DK125 FROM DK85 AT LEHMAN
+ MAN GROUP PRICE EST. RAISED TO 2800P FROM 2210P AT LEHMAN
+ ELECTRICITE DE FRANCE RAISED TO `BUY’ FROM `NEUTRAL’ AT UBS

- ANGLO IRISH CUT TO `NEUTRAL’ FROM `BUY’ AT MERRILL LYNCH
- RENAULT CUT TO `NEUTRAL’ VS. `OVERWEIGHT’ AT JPMORGAN
- DSM LOWERED TO `REDUCE’ FROM `NEUTRAL’ AT UBS

** EUROPE: TRADING HEADLINES **

- ECB Likely to Signal Higher Interest Rates as Bank of England Stands Pat
- Rally in European Stock Markets May End as Companies’ Profitability Falls
- ABB Shares May Climb After Final $1.43 Billion Asbestos Claims Settlement
- Alcatel and Lucent Will Merge: Cutting 10% of Workforce.

** EUROPE: IN PLAY TODAY **

- ABB Ltd, the world’s largest manufacturer of power
networks said on April 1 that it won the backing of claimants for a
$1.43 billion asbestos settlement, ending a liability that drove
the company to the brink of bankruptcy in 2002.

- Alcatel SA and Lucent Technologies Inc. Alcatel will acquire Lucent in a $13.4
billion share swap to create a company with about $25 billion in sales, which
would rival Cisco Systems Inc. for the top spot in the total phone and
computer-network equipment market. The companies said they plan to cut about 10
percent of their joint workforce, or 8,800 jobs, to achieve savings of 1.4
billion euros ($1.7 billion) within three years. Alcatel rose 65 cents to $15.35
in U.S. over- the-counter trading. Lucent fell 4 cents to $3.05.

- Infineon Technologies AG may sell shares in its memory-chip business in an
initial public offering “before summer,'’ Sueddeutsche Zeitung
said, citing unidentified people within the company.

- Adidas-Salomon’s CEO announced that sales of World Cup related products will
exceed the company’s expectations (Tagesspiegel).

- Mitchells & Butler is the takeover target of Robert Tchenguiz, a real estate
developer. The ££2.6bln bid could be tabled within the next 10 days (Sunday
Telegraph).

-UBS will focus on organic growth rather than acquisitions, according to the
bank’s chairman (Neue Luzerner Zeitung).

** US TRADING HEADLINES **

- General Motors May Announce Stake Sale of Its GMAC Unit Today, People Say
- Bush’s Decline in Popularity May Have Come at Worst Time for U.S. Stocks
- Dollar May Decline as ECB, BOJ Increase Rates, Survey of Traders Indicates
- Berkshire’s Buffett Makes $14 Billion Bet That Global Stocks Won’t Plunge
- Schumer, Manzullo Might Find That Higher Yuan Buys China More U.S. Assets
- GM’s U.S. Auto Sales Likely Fell in March, Dragging Industry Into Decline
- M&A Boom Lifts Takeover Fees at UBS, Makes London Cabs Richer at Midnight
- McClatchy May Raise $1.75 Billion by Selling 12 Knight Ridder Newspapers
- Alcatel and Lucent Say They Will Merge, Cutting 10% of Workforce

** Warren Buffett Bet **

Struggling to find acquisitions big enough to boost Berkshire Hathaway Inc.’s
returns, is making a $14 billion bet on the global stock market. Berkshire sold
a form of insurance to buyers who wanted protection from a drop in “four major
equity indexes'’ over the next 15 to 20 years, according to a U.S. Securities
and Exchange Commission filing. Instead of buying the individual shares,
Buffett is wagering the indexes, three of which are outside the
U.S., won’t tumble and force Omaha, Nebraska-based Berkshire to
pay a claim.

** ASIAN HEADLINES **

- Japan’s Business Confidence Drops; Companies Plan to Increase Investment
- Asian Stocks Climb to 16-Year Highs as Honda, Samsung Electronics Advance
- Australian Trade Deficit Narrows to Lowest in Four Years on Record Exports
- Thai Beverage May Raise $1 Billion in Singapore Initial Public Offering
- Daewoo Shipbuilding Receives $772 Million Orders to Build Gas, Oil Tankers
- China’s Premier Wen Jiabao Says Iron Ore Prices Should Be Set By Companies
- South Korea Offers $20 Billion in Baby Bonuses to Keep Economy Expanding