Milan shares close lower, tracking US, led by Telecom Italia, cements - UPDATE |
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Wed, 10 Jan 2007 18:35
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(updating with full report)MILAN (AFX) - Share prices closed lower after Wall Street's lacklustre opening, led by Telecom Italia and cement company stocks on profit-taking after recent gains, brokers said.The Mibtel index was down 0.42 pct to 31,805 points and the S&P/Mib fell 0.50 pct to 41,360.Volume was an estimated 5.866 bln eur.Brokers said the trend in the oil price remains a key factor, though most brokers do not expect the price to fall much further.The lower oil price could dampen inflation worries, they said, adding that all the same there is uncertainty on the European Central Bank decision tomorrow on any interest rate increase.One broker said it is certain that the ECB will increase its interest rates by 0.25 pct at some point in the next two to three months.On sectors, he said that construction stocks have room to rise further after yesterday's gains on lower oil prices, while other cyclicals are favoured, such as health care stocks.Telecom Italia lost 2.05 pct to 2.335 eur in line with the European sector, and on profit-taking after gains late last year. Fastweb fell 0.45 pct to 45.95.In the cement sector, Buzzi Unicem was off 1.56 pct to 21.46 and Italcementi down 1.67 pct to 21.76.Among gainers, Tenaris rose 4.42 pct, off its morning highs, on speculation of a bid or stake-building by respectively Vallourec or Gazprom. Vallourec denied an interest, while Tenaris noted previous denials on Gazprom.Analysts continue to say it is unlikely the Rocca family, which controls Tenaris via its 60 pct stake, will give up or share control, adding that fundamentals for Tenaris remain strong.Other oil-related stocks were mixed. Saipem was up 0.39 pct to 18.33 and Eni lost 0.94 pct to 24.33.Autostrade was up 4.29 pct to 22.59. Brokers said there were positive comments after motorway industry leaders met government officials to resolve a row about tariff rises for this year.One broker said he believed the 4 pct plus rise in Autostrade was overdone, given that details on any resolution on tariffs remain sketchy.STMicro rose 0.78 pct to 14.65 after a Lehman Bros upgrade to 'overweight', from 'underweight', upping the price target to 16 eur, from 12, citing the company's reorganisation of flash memories.Mediaset lost 0.30 pct to 9.30. Italy's De Agostini said it did not see scope under government reforms to enter the TV broadcasting market.Banks failed to react much to Bank of Italy changes favouring issue of so-called hybrid or equity-type funding, which brokers said will support mergers. Intesa Sanpaolo lost 1.60 pct to 5.61.nigel.tutt@afxnews.comnt/tw/nt/twCOPYRIGHTCopyright AFX News Limited 2006. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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Milan shares lower at mid-session; Tenaris bucks trend 