By Dow Jones Business News,
December 11, 2013, 10:31:00 AM EDT
By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- European stocks struggled to hang onto gains Wednesday, with Natixis SA, Vivendi SA and
European Aeronautic Defence & Space Co. rising, while miners pulled in the other direction.
Italian stocks fell ahead of a confidence vote.
The Stoxx Europe 600 index slipped 0.1% to 314.51 as investors mulled a U.S. budget deal and what it could mean for
the Federal Reserve's bond-buying program.
The index snapped a two-day winning streak on Tuesday, when it fell 0.7%.
Shares of First Group PLC rose 4.7% after the U.K. rail company said it was against a shareholder plan to split the
company. Sandell Asset Management has approached First Group about separating the group and disposing of assets, the
company said in a statement.
Ratings changes moved the needle on some shares, such as Natixis , up 3.3% after it was reportedly upgraded to
outperform from neutral by Exane BNP Paribas. Vivendi SA rose 2.8% after Bernstein reportedly lifted shares to
outperform from market perform.
Imagination Technologies Group PLC shares sank 20% after half-year sales fell short of analyst expectations.
Shares of the Royal Bank of Scotland Group (RBS) fell 3.2% after the bank said Nathan Bostock, group finance
director, will step down.
"The theme is still low-volume down days and aggressive buying. Buy-side volume is much higher than thin selling,"
said Atif Latif, director of trading at Guardian Stockbrokers, in emailed comments.
He said comments from European Central Bank Vice President Vitor Constancio underpinned sentiment. Constancio
reportedly said there is no shortage of ECB-eligible collateral in any euro-zone nation, meaning banks can boost funding
without problems if needed.
In economic news, German consumer prices rose slightly, but inflation was overall contained.
In Washington, House and Senate negotiators announced a budget deal on Tuesday evening.
"Confirmation that a budget deal has been negotiated is a real step in the right direction -- but the deal, if
confirmed by both the House and Senate, would certainly have the potential to bring forward the prospect of tapering"
and weigh on stocks, said Rebecca O'Keeffe, head of investment at stockbroker Interactive Investor, in a note to
Tapering refers to a potential move by the Federal Reserve to scale back its bond-buying program.
The French CAC 40 gained 0.4% to 4,108.51, helped by Vivendi SA and a 7% gain for European Aeronautic Defence &
Space EADS NV , which reaffirmed a return on sales of 10% by 2015, excluding one-off items and costs linked to the
ramp-up of its wide-bodied A350 airliner.
The German DAX 30 index was flat at 9,103.12, with Bayer AG up 0.7% and Daimler AG up 1%.
The FTSE 100 index was flat at 6,524.94. Mining stocks were trading lower, with Randgold Resources Ltd. and BHP
Billiton PLC ( BHP ) each off more than 1%.
Italian stocks fell ahead of a confidence vote for Italian Prime Minister Enrico Letta. Media reports said he's
expected to win the vote, which is due later Wednesday. Italy's FTSE MIB index fell 1.1% to 18,028.97.
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