Tuesday Morning View From Europe

by: Dealing Floor

From DealingFloor:

** EUROPE: UPS & DOWNS **

+ ERICSSON PRICE ESTIMATE RAISED TO SK34 FROM SK32 AT UBS
+ NOKIA PRICE ESTIMATE RAISED TO EU21 FROM EU20 AT UBS
+ BRITISH LAND RAISED TO `BUY’ FROM `NEUTRAL’ AT UBS
+ Morgan Stanley Raises China 2006 GDP Forecast on Investment
+ LUFTHANSA PRICE ESTIMATE RAISED FROM EU15.4 AT MORGAN STANLEY
+ SAINT GOBAIN PRICE EST. RAISED TO EU63 FROM EU60 AT DEUTSCHE
+ STATOIL PRICE ESTIMATE RAISED TO NK220 FROM NK190 AT MERRILL

- GE PRICE ESTIMATE CUT 4.4% TO $38.25 AT MERRILL LYNCH

** EUROPE: HEADLINES **

- Europe’s Stock Rally May Slow as Higher Bond Yields Hurt Dividends’ Appeal
- France’s Alstom Offers to Buy Controlling Stake in China’s Wuhan Boiler
- U.K. Inflation Rate Probably Reached Bank of England Target, Survey Shows

** EUROPE: IN PLAY TODAY **

- BASF AG extended its $4.9 billion bid for Engelhard Corp. for a
fourth time as it seeks to persuade investors in the world’s biggest maker of
catalytic converters to tender their stock. BASF indicated it may increase the
offer.

- BP Plc will get a U.S. Supreme Court hearing in a multimillion-dollar fight
over the royalties due on oil, gas and other minerals extracted from
federal and Indian-owned lands.
Separately, the U.K.-based oil company has found another
pipeline break in Alaska, the Wall Street Journal reported,
citing company spokesman Daren Beaudo. The break occurred April 6
on an elevated natural-gas line, the newspaper reported.

- Credit Agricole SA is one of five banks chosen to continue talks about buying
KBC Group NV’s Spanish private-banking unit Banco Urquijo SA, Cinco Dias said,
citing people close to the situation that it didn’t name.

- Deutsche Post AG: DHL Worldwide Express, the package-delivery unit of Europe’s
biggest postal system, will invest $24 million to build the headquarters for
its express operations in Beijing.
Separately, Deutsche Post plans no more big acquisitions in
the next two years after a period of “rapid'’ expansion, Reuters
said, citing an interview with Chief Executive Officer Klaus
Zumwinkel.

- France Telecom SA lost almost 1 million clients through the end
of March that have switched to competitors including Iliad SA’s
Free, Le Monde said in its online edition, citing a study by the
French telecom regulator.

- Schroders Plc, The U.K.’s second-largest publicly
traded money manager plans to buy back non-voting shares through
May 16. The company didn’t say how many shares it planned to
repurchase.

- Telefonica SA said it expects to receive more than one bid for its 3.3
billion-euro phone directory unit after a report that Yell Group Plc is the
only bidder left.
Also, the Madrid-based company won’t take on more debt in the next 12 months,
signaling it doesn’t plan to make any large acquisitions, El Pais reported April
14, citing regulatory filings.

- Total SA said April 14 in a statement on its Web site that first-quarter
crude-processing margins, or the profit made from turning each barrel
of crude into products such as gasoline and diesel, dropped to
$25.80 a ton from $45.50 a ton, the biggest decrease in almost
three years while natural gas and oil prices averaged record
highs.

- Royal Philips Electronics NV said first-quarter profit rose 37 percent on an
acquisition in the lighting division and demand for semiconductors and
flat-screen televisions. Net income increased to 160 million euros ($196
million), or 13 cents a share, from 117 million euros, or 9 cents, a year
earlier. Sales rose to 7.37 billion euros from 6.49 billion euros. Sales & Net
Income bothe beat analyst expectations.

- Hennes & Mauritz AB, which is jostling with Inditex SA for the rank of
Europe’s largest clothing retailer, said same-store sales fell in March as cold
weather and a later Easter holiday weighed on demand. Sales at outlets open more
than one year dropped 8 percent, the Stockholm-based company said today in an
e-mailed statement. Analysts expected a decline of 4 percent, according to the
median of seven estimates collected by Bloomberg News. Total sales for March
excluding currency effects was unchanged.

** ASIAN MARKETS **

Nikkei 1,52%; Kospi 0,39%; HSI 1,14%; Taiwan -0,15%; China 0,88%; India 1,7%;
Thailand 1,3%; Australia 1,24%

** TRADING HEADLINES **

- Asian Stocks Rise, Led by BHP Billiton and PetroChina as Crude Oil Jumps
- Morgan Stanley to Sell $2.9 Billion of Bonds Backed by Japanese Property
- Japanese Bonds Drop; 10-Year Yield at 2 Percent for First Time Since 1999
- Copper Rises to Record, Doubling Year-Ago Price, as China’s Economy Grows
- Japan’s Economy Expanding in All Nine Regions, Bank of Japan Bureaus Say
- Microsoft’s $1.2 Billion Order From China’s Lenovo Signals Piracy Progress
- Gold Rises in Asia as Fund Investors Hedge Against Rising Crude Oil Prices
- Corn, Sugar Futures Advance on Tokyo Commodity Exchange; Soybeans Decline
- South Korean Shipyards Win Record $12 Billion in Orders in First Quarter