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European Stocks Are Little Changed on China Export Data

Published: January 10, 2013 | 8:29 am
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European (SXXP) stocks were little changed as Chinese export data topped economists’ forecasts, and before European Central Bank policy makers meet. U.S. index futures and Asian shares also rose.

Tesco (TSCO) Plc gained 2.9 percent after reporting the strongest sales growth since 2010. Marks & Spencer Group Plc (MKS) fell 3.2 percent after sales dropped more than estimated.

The Stoxx Europe 600 Index advanced 0.1 percent to 288.43 at 8:05 a.m. in London. The benchmark gauge last week surged 3.3 percent after U.S. lawmakers agreed on a compromise budget to prevent most scheduled tax increases and delay spending cuts in the world’s largest economy. Standard & Poor’s 500 Index futures increased 0.2 percent today, while the MSCI Asia Pacific Index climbed 0.7 percent.

“Whilst the U.S. and Asia are beginning to show the signs of a sustained recovery, the European economies continue to gyrate around recessionary levels,” Jonathan Sudaria, a trader at Capital Spreads in London, wrote in a note. “Hopes are that last year’s extraordinary monetary measures by the Bank of England and European Central Bank will finally filter in to the real economy at some point later this year.”

In China, exports rose 14.1 percent in December from a year earlier, while imports increased 6 percent, the customs office said. The pickup in overseas shipments beat the 5 percent median estimate of 40 analysts in a Bloomberg News survey and a 2.9 percent increase the previous month.

ECB Meeting
ECB policy makers begin their first meeting of the year in Frankfurt today. Only five out of 55 economists in a Bloomberg survey predict the central bank will reduce the benchmark interest rate, with the rest seeing it held at a record-low 0.75 percent.

Bank of England policy makers will probably refrain from adding further stimulus to the U.K. economy. Governor Mervyn King and the Monetary Policy Committee will opt to watch for further progress in the Funding for Lending Scheme and keep the target for quantitative easing at 375 billion pounds ($601 billion), said all 39 economists in a Bloomberg News survey.

U.S. Labor Department figures due at 8:30 a.m. in Washington will probably show new applicants for unemployment benefits fell to 365,000 last week from 372,000 the previous week, according to the mean estimate in a Bloomberg News survey of economists.

Tesco Sales
Tesco gained 2.9 percent to 359.4 pence. The U.K.’s biggest grocer reported the strongest sales growth since 2010 as money- off coupons and smarter stores helped spark a revival.

U.K. sales at stores open at least a year rose 1.8 percent in the six weeks ended Jan. 5, excluding gasoline and value- added tax, the company said today in a statement. That was only the second positive performance in eight quarters and beat the 1 percent median estimate of 10 analysts surveyed by Bloomberg News.

ARM Holdings Plc (ARM), whose chip designs power Apple’s iPhones, added 0.7 percent to 832.5 pence after industry peer Dialog Semiconductor reported a 56 percent increase in fourth-quarter revenue to $268 million.

MAN SE gained 5.8 percent to 88.86 euros. Volkswagen AG, Europe’s largest carmaker, will offer to buy out the rest of the German truckmaker’s shareholders to take full control of the company.

VW, which already holds 75.03 percent of the voting rights, will seek a domination agreement and start talks with MAN’s board, the Wolfsburg, Germany-based automaker said in a statement after the market closed yesterday. The remaining stake is worth about 3.2 billion euros based on yesterday’s closing price.

Marks & Spencer, the U.K.’s largest clothing retailer, slid 3.2 percent to 359.2 pence after it said same-store revenue at the general merchandise unit fell 3.8 percent in the 13 weeks ended Dec. 29. That compares with the median estimate of nine analysts for a 1.5 percent decline and the prior quarter’s 1.8 percent drop. Food sales at stores open at least a year rose 0.3 percent, also missing the median estimate of 1 percent.

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