IKB subprime shockwaves continue to rock Germany

(Reuters) - German commercial property financier Hypo Real Estate struggled to calm jittery investors by insisting it would be unaffected by the U.S. subprime fallout. Its shares still skidded more than 5 percent while Commerzbank -- which owns a property financier -- saw its stock fall 4 percent.




Investor confidence was further dented as it emerged that French insurer Axa had also temporarily closed two subprime funds after sudden losses.


Read more at Reuters.com Bonds News

German Stocks Advance; Deutsche Bank, MAN AG, DaimlerChrysler Lead Gains

(Bloomberg) -- German stocks advanced, led by
Deutsche Bank AG, MAN AG and DaimlerChrysler AG.

The benchmark DAX Index added 92.86, or 1.3 percent, to
7549.17 as of 9:10 a.m. in Frankfurt. The HDAX Index of the
country's 110 biggest companies climbed 1.3 percent.


Read more at Bloomberg Stocks News

Dollar Heads for Monthly Drop Against Euro Before Consumer Spending Report

(Bloomberg) -- The dollar headed for a second
monthly decline against the euro before a U.S. government report
today that economists predict will show slowing consumer
spending growth.

The U.S. currency was weaker against 15 of the 16 most-
actively traded currencies on prospects that a U.S. economic
slowdown and a slump in corporate debt may prompt the Federal
Reserve to lower interest rates. The yield spread between
benchmark two-year U.S. and German bonds narrowed last week to
the least since November 2004.


Read more at Bloomberg Currencies News

Japan's Nikkei Drops, Paced by Nomura on Subprime Concern; Olympus Gains

(Bloomberg) -- Japan's Nikkei 225 Stock Average
slipped after Germany's IKB Deutsche Industriebank AG said losses
on subprime loan investments will ``significantly'' lower profits.

Brokerages such as Nomura Holdings Inc., with similar
investments, led declines on concern they will also be affected.


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Currency Option Volatility Edges Higher as Credit Risk Measures Increase

(Bloomberg) -- Option volatility on most major
exchange rates edged higher as investors demand safer assets and
indicators of corporate bond risk surged.

The perceived risk of owning European corporate bonds
soared to the highest in at least three years after Germany's
IKB Deutsche Industriebank AG reported losses on U.S. subprime
mortgages, credit-default swap prices show.


Read more at Bloomberg Currencies News

European Bonds Advance as Subprime Woes Send Corporate Debt Risk Soaring

(Bloomberg) -- European government bonds gained for
a fifth day as the risk of owning corporate debt soared to the
highest in at least three years.

Bunds rose, pushing 10-year yields to the lowest in 2 1/2
months, after Germany's IKB Deutsche Industriebank AG reported
losses linked to loans made to U.S. homeowners with poor credit
histories. Government debt dropped earlier on speculation the
European Central Bank will this week reiterate its preference for
higher rates.


Read more at Bloomberg Bonds News

U.S. Two-Year Bonds Advance After Risk of Holding Corporate Debt Surges

(Bloomberg) -- U.S. two-year Treasuries rose after
a gauge of owning corporate debt surged to the highest in at
least three years.

Benchmark 10-year bonds also strengthened, pushing yields
to near the lowest in more than two months, after Germany's IKB
Deutsche Industriebank AG reported losses on U.S. subprime
mortgages. Treasuries extended gains into a fourth week on
concern rising defaults on home loans to people with poor credit
histories will worsen a housing slowdown and hurt economic
growth.


Read more at Bloomberg Bonds News

ICI rejects improved $16 bln Akzo bid, talks continue

(Reuters) - ICI, the maker of Dulux paints, said on Monday that the two sides were still in talks after it rejected a 650 pence a share cash proposal from Akzo but it had not opened its books to the world's largest maker of industrial coatings.




Akzo, the maker of Crown paints, said it had teamed up with German consumer products group Henkel over its proposed bid, but there was no certainty it would make a better offer. Henkel would take on ICI's adhesives and electronics materials business if a deal went through, Akzo said.


Read more at Reuters.com Business News

Europe Bonds Fall on Concern Recent Gains Aren't Justified By Rising Rates

(Bloomberg) -- European bonds fell on speculation
the longest run of weekly gains in five months isn't justified
by expectations for higher interest rates in the euro region.

The yield on the German 10-year bund, Europe's benchmark,
rose 2 basis points to 4.33 percent as of 7:21 a.m. in London,
after reaching 4.30 percent last week, its lowest since mid-May.
The price of the 4.25 percent security due July 2017 fell 0.16,
or 1.6 euros per 1,000-euro ($1,364) face amount, to 99.34.


Read more at Bloomberg Bonds News

European Bank Stocks May Decline, Led by ING, Credit Suisse, IKB Deutsche

(Bloomberg) -- European bank stocks may drop after
IKB Deutsche Industriebank AG, a German lender that invested in
U.S. subprime mortgages, said profit will be ``significantly''
lower than forecast.

``The subprime crisis has reached Germany,'' said Klaus
Stabel, head of research at ICF Kursmakler AG in Frankfurt.
``It's bad for sentiment. We haven't seen the bottom yet.''


Read more at Bloomberg Stocks News

UPDATE 3-Siemens promises changes after weak Q3, VDO sale

(Reuters) - FRANKFURT, July 25 - Siemens' new chief
executive promised speedy and far-sighted changes after
announcing an 11.4 billion euro disposal, a $7
billion acquisition and weak quarterly results on Wednesday.




Shares in the German group plunged 7 percent after Siemens
disappointed on both top and bottom lines with its third-quarter
results. It gave no clear reasons after rivals General Electric
and Alstom reported booming demand.


Read more at Reuters.com Market News

German, Dutch Next-Day Power Decline on Cooler Weather, Wind Production

(Bloomberg) -- German and Dutch day-ahead
electricity fell as forecasts showed temperatures will be below
average tomorrow and production from wind turbines will remain
higher than normal. Next-year power prices also declined,
tracking lower emissions costs.

Electricity for tomorrow in Germany, Europe's biggest power
market, dropped 16 percent to 27 euros ($37.30) a megawatt-hour
at 11:24 a.m. Berlin time, according to broker Spectron Group
Plc. The corresponding price in the Netherlands declined 13
percent to 29.50 euros a megawatt-hour.


Read more at Bloomberg Energy News

European Insurance Stocks Gain; Hypo Real Estate, Nestle Lead Decline

(Bloomberg) -- European insurance stocks rose, led
by Friends Provident Plc and Resolution Plc, after the companies
said they are in talks for a merger that would create the U.K.'s
fifth-biggest insurer.

Friends Provident Plc jumped the most in more than two
months. Hypo Real Estate Holding AG paced declining shares after
the German real-estate financing company agreed to buy Depfa Bank
Plc for 5.7 billion euros ($7.9 billion).


Read more at Bloomberg Stocks News

EnBW's Philippsburg-2 Nuclear Reactor Returns to Service After Repair Work

(Bloomberg) -- Energie Baden-Wuerttemberg AG,
Germany's third-biggest utility, said it began power generation
at its Philippsburg-2 nuclear reactor which had been halted for
annual maintenance.

The unit, which has a capacity of 1,458-megawatts, was
stopped at the beginning of the month, the company said in a
statement. It was restarted over the weekend.


Read more at Bloomberg Energy News

Vattenfall's Brunsbuettel Nuclear Plant to Stay Shut Until Repairs Finish

(Bloomberg) -- Vattenfall Europe AG, Germany's
fourth-largest utility, will keep its Brunsbuettel nuclear plant
halted until repairs to screw anchors are complete.

Repairs tomorrow will focus on ``the part of the system that
can only be accessed when the reactor is off,'' Vattenfall
spokesman Ivo Banek said by phone today from Hamburg. ``We don't
know yet how long that's going to take. It can be a few days, or
can be much longer.''


Read more at Bloomberg Energy News

Dollar's Record-Setting Tumble Turns Into Boon for George Bush, Coca-Cola

(Bloomberg) -- Everyone from Nobel Prize laureates
to the world's biggest bond investor says the Bush administration
has reason to cheer the dollar's slide to historic lows.

The currency has lost 13.2 percent since January 2001, when
George W. Bush took office, the most under any president since at
least Gerald Ford, who left the White House in 1977. That's based
on a Federal Reserve index that tracks the dollar against the
currencies of 38 U.S. trading partners, including Germany, Japan
and Canada.


Read more at Bloomberg Currencies News

German 2008 Power Increases as Carbon Dioxide Emission Permit Costs Gain

(Bloomberg) -- German power for delivery next year
rose for the first time in five days as carbon-emissions costs
rebounded from an 11-week low.

Next-year baseload power prices in Germany, Europe's
biggest electricity market, gained 1 percent to 55.25 euros
($76.16) a megawatt-hour at 5:43 p.m. Berlin time, according to
broker GFI Group Inc. The contract earlier fell as much as 0.3
percent. Baseload is electricity delivered around the clock.


Read more at Bloomberg Energy News

Air Berlin, Commerzbank, Siemens, Duerr, Vattenfall: German Equity Preview

(Bloomberg) -- The following stocks may rise or fall
in German markets. Stock symbols are in parentheses after company
names and prices are from the Xetra close unless otherwise
stated.

DAX futures expiring in September rose 50 points, or 0.6
percent, to 8155.50 on July 13 in Frankfurt. The DAX increased
0.5 percent to 8092.77 on the Xetra electronic-trading system.


Read more at Bloomberg Stocks News

Roche, SAP, Ericsson Earnings, Germany's ZEW Index: European Week Ahead

(Bloomberg) -- Earnings from Roche Holding AG, the
world's biggest maker of cancer medicine, SAP AG, the largest
global maker of business-management software, and Ericsson AB,
the No. 1 maker of wireless phone networks, may move stock
markets next week.

Data on German investor confidence from the ZEW Center for
European Economic Research in Mannheim may also affect markets.


Read more at Bloomberg Stocks News

Atrium to buy Germany's Mucos for $175 mln

(Reuters) - Atrium said the purchase of the German drug maker will
immediately boost its earnings per share by about 45 percent.




Read more at Reuters.com Mergers News