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** EUROPE: TRADING HEADLINES **

* EMI OFFERED TO BUY WARNER MUSIC FOR $28.50 IN CASH AND STOCK
- ECB’s Issing, Ready to Retire, Finds His Asset-Bubble Views Gain Support
- European Union to Fine Solvay, Competitors for Peroxide Cartel, People Say
- Dollar Weakens Against Euro on Speculation Service Industry Growth Slowed
- Oil Rises for a Fourth Day on Concern Exports From Iran Might Be Disrupted

** EUROPE: IN PLAY TODAY **

- Earnings of note: Getronics, Deutsche Bank, Buhrmann, BMW, BAT, BG Group, Fiat, Metro and TNT.

- Deutsche Bank AG, Europe’s biggest securities firm, said first-quarter profit
rose a greater-than- expected 55 percent on record revenue from sales and
trading. Net income increased to 1.7 billion euros ($2.1 billion), or
3.3 euros a share, from 1.1 billion euros, or 2.09 euros, a year
earlier, the bank said in a statement today. That beat the 1.31
billion-euro median estimate of 22 analysts surveyed by Bloomberg
News. Revenue rose 21 percent to 8 billion euros.

- Buhrmann NV, the world’s largest distributor of office supplies, posted a
first-quarter profit as acquisitions added to North American sales.
Net income was 24.5 million euros ($31 million), compared with a loss of 77.7 million euros in the year-earlier period, the Amsterdam-based company said today in an e-mailed statement. Buhrmann was expected to report profit of 25.6 million euros, according to an estimate from Delta Lloyd Securities.

- Allianz AG Europe’s biggest insurer reported a 38 percent jump in
first-quarter profit from a year earlier to 1.8 billion euros ($2.3 billion), as
Dresdner Bank and the life insurance unit benefited from market gains. That
beat the 1.27 billion-euro median estimate of nine analysts surveyed by
Bloomberg.

- BMW: The world’s largest maker of luxury cars said U.S. vehicle sales climbed 13percent in April to 28,563 models, boosted by demand for new models such as the 3-Series cars.

- DaimlerChrysler AG The world’s biggest carmaker
said after markets closed April sales fell 6.2 percent from a
year earlier to 211,365 from 225,351.

- Porsche AG said North American sales rose 9.3 percent
in April from a year earlier to 3,614 vehicles, helped by the
Boxster and 911 sports cars.

- Volkswagen AG: Chief Executive Officer Bernd
Pischetsrieder received a five-year extension of his contract,
ending weeks of speculation as to whether he would remain at the
helm of Europe’s largest carmaker.

- Metro AG, Germany’s largest retailer, said first-quarter profit dropped 44
percent as advertisements intended to revive sales at the company’s Real
hypermarket chain failed to lure shoppers. Net income fell to 6.4 million euros ($8.1 million), or 2 cents a share, from 11.4 million euros, or 3 cents, a year earlier, the company said in a statement handed to journalists at its headquarters in Dusseldorf, Germany today. A Bloomberg survey of 10 analysts showed a median estimate of 7 million euros. Sales rose 4.8 percent to 13.3 billion euros.

- Henkel KGaA, the German maker of Persil and Purex detergents, said
first-quarter earnings advanced 9.7 percent as the company boosted sales of its most profitable brands in the U.S. Net income rose to 181 million euros ($229 million) from 165 million euros a year earlier, the Dusseldorf, Germany-based company said today in an e-mailed statement. Analysts expected figure of about 185 million euros. Sales rose 11 percent to 3.05 billion euros, the company said.

- Cap Gemini reported a 9.8% rise in 1Q revenue to E1.87bln (E1.79bln expected).
The company lifted its FY 06 sales growth forecast to more than 8% excluding
currencies from prior target of 7%.

- Siemens may cut more jobs at its communications division than the 1,000
additional positions announced last week (Sueddeutsche Zeitung). The stock
closed at a 3-month relative low against the Dax yesterday.

- Fresenius Medical Care delivered 1Q net income of E65m, inline with market
expectations on revenue up 34% to E2.39bln (E2.36bln). The company forecasts a
30% increase in FY net income for 2006.

- Heidelberger Druckmaschinen reported FY net income E135m (E136.8m expected) on
revenue up 12% E3.59bln (E3.45bln).

- Mittal Steel interrupted production at a unit in Chicago after “significant”
fire damage caused by molten metal.

- British American Tobacco Plc, the world’s second-biggest publicly traded
cigarette maker, said first-quarter profit advanced 5.1 percent as it cut costs
and increased sales to regions such as Africa and Asia.
Net income rose to 452 million pounds ($833 million), or 21.6
pence a share, from 430 million pounds, or 20.2 pence, a year
earlier, the London-based company said today in a Regulatory News
Service statement. The median estimate of seven analysts surveyed
by Bloomberg was 442 million pounds, or 21.3 pence a share.

- TNT NV, Europe’s second-biggest express-package delivery company, said first-quarter profit rose 6.2 percent and announced targeted cost cuts of 75 million euros ($94.9 million). Net income increased to 205 million euros from 193 million euros a year earlier, Hoofddorp, Netherlands-based TNT said in a statement today. Revenue rose 8.9 percent to 2.6 billion euros. Net income beat the 204 million-euro median estimate of 10 analysts surveyed by Bloomberg News. Sales exceeded the analysts’ 2.53 billion-euro estimate.

- BG Group Plc, the U.K.’s third-largest oil company by market value, said
profit more than doubled in the first quarter as prices rose and it increased
sales of liquefied natural gas to Europe and Japan.
Net income more than doubled to 578 million pounds ($1.06
billion), or 16.4 pence a share, compared with 259 million pounds,
or 7.3 pence a share in the year-earlier period, the Reading,
England-based company said today in a Regulatory News Service
statement.

- British American Tobacco Plc, the world’s second-biggest publicly traded
cigarette maker, said first-quarter profit advanced 5.1 percent as it cut costs
and increased sales to regions such as Africa and Asia.
Net income rose to 452 million pounds ($833 million), or 21.6
pence a share, from 430 million pounds, or 20.2 pence, a year
earlier, the London-based company said today in a Regulatory News
Service statement. The median estimate of seven analysts surveyed
by Bloomberg was 442 million pounds, or 21.3 pence a share.


** EUROPE: UPS & DOWNS **

+ CIBA SPECIALTY CHEMICALS PRICE EST. CUT TO SF69 VS SF73 AT UBS
+ CREDIT SUISSE GROUP PRICE EST. RAISED TO SF92 VS SF90 AT UBS
+ NUMICO PRICE ESTIMATE RAISED TO EU45 FROM EU43.5 AT UBS
+ CREDIT SUISSE PRICE EST. RAISED TO SF88 FROM SF82 AT DEUTSCHE
+ CARREFOUR PRICE ESTIMATE RAISED TO EU54 FROM EU50 AT DEUTSCHE
+ LAFARGE PRICE EST. RAISED TO EU115 FROM EU100 AT CREDIT SUISSE
+ SCHNEIDER PRICE ESTIMATE RAISED 8.9% TO EU98 AT JPMORGAN
+ CREDIT SUISSE PRICE EST. RAISED 5.1% TO SF82 AT JPMORGAN
+ LADBROKES PRICE ESTIMATE RAISED TO 410P FROM 380P AT LEHMAN
+ LAFARGE CUT TO `HOLD’ FROM `BUY’ AT CITIGROUP
+ ABERDEEN ASSET PRICE ESTIMATE WAS 200P AT MORGAN STANLEY
+ NUMICO PRICE ESTIMATE RAISED TO EU41 VS EU39 AT MORGAN STANLEY
+ DANSKE BANK PRICE ESTIMATE RAISED TO DK265 FROM SK260 AT ABN
+ ASTRAZENECA PRICE EST. RAISED 13% TO 3,100P AT CREDIT SUISSE
+ DANSKE BANK PRICE EST. RAISED TO DK255 FROM DK246 AT DEUTSCHE
+ MAN AG PRICE ESTIMATE RAISED 35% TO EU65 AT CREDIT SUISSE
+ PUMA PRICE ESTIMATE RAISED TO EU380 FROM EU350 AT DEUTSCHE

- BALLY TECHNOLOGIES CUT TO `SELL’ FROM `HOLD’ AT CITIGROUP
- SMITH & NEPHEW PRICE ESTIMATE CUT 6% TO 485P AT CREDIT SUISSE

** US: TRADING HEADLINES **

- GM, Ford, Chrysler Sales Fall on Record Gas Prices; Toyota Increases Share
- U.S. Stocks Rise as TXU, Archer Daniels, St. Paul Earnings Beat Estimates
- Electronic Data Posts $24 Million Profit on U.S. Navy Service Contract
- Senate Refuses to Cut Northrop Storm Relief From Emergency Spending Bill
- Vioxx-Linked Heart Attacks May Occur Within Two Weeks, Canadian Study Says
- Crude Oil Rises Amid Speculation Iranian Shipments Might Be Disrupted
- Gold Trades Near 25-Year High as Iranian Nuclear Program Dispute Escalates

** IRAN SAGA **

- WASHINGTON, May 2, 2006 (Xinhua via COMTEX) — The United States said on
Tuesday that it is pursuing a diplomatic solution to Iran’s nuclear issue and
military action is not on the agenda right now.

** US: AFTER HOURS **

-Allied Waste (-8% after hours) reported Q1 earnings of $0.08 per share, a penny
worse than the Reuters Estimates consensus of $0.09. Total revenues rose 7.3%
year/year to $1.44 bln versuss the $1.4 bln consensus.

- EDS (-1% after hours) reported Q1 earnings of $0.06 per share, two cents worse than
the Reuters Estimates consensus of $0.08. Revenues rose 7.2% year/year to $5.08
bln (consensus $4.8 bln). Co issued downside guidance for Q2, sees EPS of
$0.12-017 (consensus $0.18) and revenues of $5.0-5.2 bln (consensus $5.05 bln).
Co issued in-line guidance for FY06, sees EPS of $0.83-0.93 (consensus $0.89)
and revenues of $20-20.5 bln (consensus $20.08 bln).

** US: IN PLAY TODAY **

March Factory Orders (consensus 3.7%) and April ISM Services (consensus 59.4) are
released at 16:00 CET.

On the earnings front, Dow component Procter &Gamble (NYSE:PG) will be Wednesday
morning’s headliner. Other notable names reporting before the bell include Time
Warner (NYSE:TWX), Qwest (NYSE:Q), Allergan (NYSE:AGN), Alltel (NYSE:AT), Cigna (NYSE:CI), Clorox (NYSE:CLX),
CMS Energy (NYSE:CMS), Dean Foods (NYSE:DF), Devon Energy (NYSE:DVN), Marsh McLennan (NYSE:MMC), and
NiSource (NYSE:NI). After the close, Starbucks (NASDAQ:SBUX) and Prudential (NYSE:PRU) lead a
list that also includes Barrick Gold (NYSE:ABX), Career Education (NASDAQ:CECO), Sunoco
(NYSE:SUN), UNUMProvident (NYSE:UNM), and Whole Foods (WFMI)

** ASIAN MARKETS **

Nikkei closed ; Kospi 0,47%; HSI 0,86%; Taiwan 0,59%; China 1,66%; India 0,39%; Thailand 0,75%; Australia -0,07%

** ASIAN HEADLINES **

- Australia Unexpectedly Raises Interest Rates for First Time in 14 Months
- Toyota Leads Asian Carmakers’ U.S. Market Gains, Overtakes DaimlerChrysler
- Asian Stocks Rise for Third Day; BHP and Cnooc Gain as Commodities Climb
- Bank of China May Lose $537 Million This Year on Yuan’s Increasing Value
- Creative Technology Has Record Quarterly Loss as Music Player Prices Drop
- Asian Finance Ministers May Resist Calls to Let Currencies Rise Faster
- Australian `Small-Cap’ Mining Companies Outperform BHP as Metals Surge

Source: Wednesday Morning View From Europe