MW: Oil producer gains boost Europe; ING revamp jolts stock
Germany's Merck KGaA off; Electrolux rises after reporting earnings
By Sarah Turner, MarketWatch
LONDON (MarketWatch) -- ING shares tumbled on Monday after the Dutch banking and insurance firm unveiled a restructuring, with financial-sector losses taking the shine off gains for the broader European market.
The pan-European Dow Jones Stoxx 600 index (ST:SXXP 246.18, +1.29, +0.53%) edged up 0.6% at 246.31. In the plus column, oil producers lifted the market as Royal Dutch Shell (UK:RDSA 1,938, +32.00, +1.68%) (RDS.A 63.41, +1.26, +2.03%) rose 1.2%, and oil futures topped $80 a barrel.
Equity strategists at Morgan Stanley said that they expect the current "sweet spot" for European stocks to last until policy-makers raise interest rates, adding that the current gains seem likely to slow and broaden out.
The strategists noted that the market in the last six months has seen the biggest rally on record for European equities.
On a regional level, the U.K. FTSE 100 index (UK:UKX 5,276, +33.26, +0.63%) rose 0.6% to 5,275.51, the German DAX index (DX:DAX 5,790, +50.17, +0.87%) traded up 0.8% to 5,787.69, and the French CAC-40 index (FR:PX1 3,833, +24.40, +0.64%) climbed 0.6% to 3,832.12.
Asian equities were mostly higher, while U.S. stocks opened with gains on Wall Street. See Asia Markets.
There were some big moves on the individual stock level in Europe, with ING (NL:INGA 10.24, -1.44, -12.31%) (ING 15.11, -2.26, -13.01%) shares down 13.2% in Amsterdam after it announced a sweeping plan to break itself apart as well as to repay some of the state aid that Holland has provided. See full story.
"There's going to be some pressure on banks to concentrate on their core businesses and use money generated to repay government stakes," said Peter Dixon, strategist at Commerzbank.
Other banks under pressure in Europe included Lloyds Banking Group (UK:LLOY 91.98, -4.28, -4.44%) (LYG 6.07, -0.23, -3.67%) , down 5%, and Royal Bank of Scotland (UK:RBS 45.76, -1.36, -2.89%) , down 2.8%. Both have received support from the U.K. government during the financial crisis.
Turning to earnings and shares of Swedish appliance maker Electrolux (SE:ELUXB 165.00, +0.50, +0.30%) jumped % in Stockholm.
Third-quarter net jumped to 1.6 billion Swedish kronor ($236 million) from 847 million kronor a year ago, soundly beating analysts' forecasts. Sales rose 4.8% to 27.6 billion kronor. See full story.
On the downside, shares of German pharmaceutical and chemical company Merck KGaA (DE:MRK 68.05, -1.45, -2.09%) fell 2.1%.
Third-quarter net income fell 28% from the year-earlier period to 144.4 million euros ($217 million) and the firm said it expects its total revenue for 2009 will grow 2%, around the mid-point of a 0% to 5% range given in July.
The digital marketing firm said that its third-quarter profit will be lower than previously expected due to lower revenue and higher costs. It expects to issue shares via a rights issue to raise 350 million Swedish kronor.
