Lower finish amid continued wrangling
Stocks closed lower amid continuing differences over how to deal with the Eurozone crisis.
The unexpected meeting yesterday between French President Nicholas Sarkozy and German Chancellor Angela Merkel, seems not to have borne any fruit as regards efforts to improve the efficacy of the European Financial Stability Fund (EFSF).
If anything, the French premier and his German counterpart now seem at odds over how to move forward, although contacts and consultations are expected to be ongoing until this weekend´s summit.
The long-standing bone of contention over whether, and if so, to what extent, the European Central Bank should act as a "back-stop" for the bail-out fund remains a source of friction between France and Germany. The EU has agreed that about €100bn is needed to recapitalise the banking system, but remains split over the strengthening of the EFSF
The CAC index in France fell 73 points to 3,084 while the DAX in Germany dropped 147 points to 5,766.
Actelion was a major drag on the index after disappointing third quarter figures. Europe's largest biotechnology company saw total product sales in the first nine months of 2011 ease to CHF.1.37bn from CHF.1.48bn in the corresponding period of 2010, as the strength of the Swiss franc (CHF) took its toll; in local currencies, sales were up 7% year-on-year.
As far as 2012 product sales, measured in local currencies, are concerned, "We currently foresee slight negative growth in the low-to-mid single digit range, mostly the result of increased pricing pressure globally and increased competitive pressure in the United States," revealed chief financial officer, Andrew Oakley.
Another company lowering expectations was electric products producer, Schneider Electric. The French firm cut its 2011 earnings target for the second time in four months, as it struggles to cope with rising employment costs in emerging economies.
Earnings before interest, taxes and amortisation will probably account for around 14% of revenue this year; back in July the company had forecast it would be about 15%.
Ericsson, the Swedish network equipment giant, topped market expectations with its third quarter net income figure of SKr.3.82bn, up from SKr.3.68m in the third quarter of last year. The market had pencilled in a figure of SKr.3.67m for this year's third quarter net income.