Milan shares lower at midday as UniCredit slide continues

Milan shares lower at midday as UniCredit slide continues

	Published : Fri, 26 Oct 2007 11:56 By : Agencies Print this Story

MILAN (Thomson Financial) - Milan shares were lower at midday as UniCredit continued its recent market slide amid talk Lehman Brothers was selling the shares, dealers said.

At 12.50pm, the Mibtel was down 0.22 pct at 30,982 while the S&P/Mib lost 0.27 pct to 39,669.

UniCredit was down 1.72 pct at 5.54 eur, retracing some of its earlier sharper losses. A Milan dealer said Lehman Brothers was selling UniCredit stock while another trader said rumours were circulating that Bank Austria, part of the UniCredit group, was the subject of concern for its possible exposure to derivatives. The stock has fallen for the last four sessions and has lost around 16 pct from the start of the year.

Luxottica was down 1.94 pct at 23.28 eur on concerns that the weak dollar could impact the group's performance. Lehman Brothers reiterated its 'neutral' rating, seeing better value in other names in the sector.

Construction stocks fell back in step with a weak European sectoral performance. Italcementi was down 2.05 pct at 15.78 eur after SocGen cut its rating to 'hold' from 'buy' with a target of 17.2 from 26, citing higher raw material costs. Impregilo fell 1.71 pct to 5.28.

Generali was down 1.43 pct at 32.51 after recent strong gains after UK-based hedge fund Algebris attacked the insurer's corporate governance rules. Reports said Generali will answer the complaints at its board meeting on Oct 31. In a note, Lehman confirmed its 'underweight' rating on the stock with a target of 33.14, saying it is unlikely Algebris will be able to prompt a change in governance.

Mediobanca, the leading shareholder of Generali, fell 0.99 pct to 15.83 eur.

Telecom Italia was the leading gainer, up 2.31 pct at 2.19 eur after Telefonica's Telco completed its acquisition of the Pirelli-Benetton 18 pct stake in the group. Reports today said Telefonica chairman Cesar Alierta and managing director Julio Linares will be given seats on the new reorganized Telecom Italia board. A report from Lehman today confirmed its 'sell' rating on Telecom Italia because of structural problems facing the fixed-line incumbent.

Atlantia was up 1.39 pct at 27 eur after Merrill Lynch reiterated its 'buy' rating but raised its target to 32 from 29.

Eni rose 0.85 pct to 25.03 on strong oil prices.

Outside the blue chip index Banca Generali was up 1.08 pct at 8.69 eur after Kepler initiated coverage with a 'buy' rating and a target of 10.4.

stephen.jewkes@thomson.com

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