Plus   Neg

European Shares Seen Little Changed

European shares are seen opening flat to slightly lower on Thursday as investors fret over slowing Chinese growth and the risk of U.K.'s credit rating downgrade.

Asian shares are trading mixed on lingering concerns about downbeat Chinese growth outlook after Premier Wen Jiabao yesterday warned that the nation needs to embrace democracy and make urgent political reforms to cushion risks. India's benchmark Sensex is down 1.4 percent as the Reserve Bank of India left interest rates unchanged, citing high fiscal deficit and inflationary pressures because of the recent spike in crude oil prices.

Closer home, Fitch Ratings has downgraded the U.K.'s credit rating outlook to 'negative' from 'stable', indicating a slightly greater than 50 percent chance of a downgrade over a two-year horizon, given the economy's vulnerability to adverse economic shocks due to high indebtedness and weak economic outlook.

However, the country's long-term foreign and local currency Issuer Default Rating as well as country ceiling has been affirmed at 'AAA' to reflect the progress made in reducing the government's structural budget deficit and the credibility of the fiscal consolidation effort.

In corporate news, Swiss automation giant ABB has invested $10 million in electric vehicle charging specialist Ecotality Inc. to use its Blink operating platform for ABB's electric vehicle charging systems.

Bayer AG announced that the U.S. FDA has approved a new indication for oral contraceptive Natazia to treat heavy menstrual bleeding.

Italian car maker Fiat SpA said a transport strike in Italy has resulted in a loss of about 20,000 units in production and will reduce its market share in Italy by about 10 percent in March.

K+S AG, a German agricultural chemical and salt company, said Burkhard Lohr will take over as chief financial officer, effective June 1.

HeidelbergCement AG posted 5 percent higher net profit to 534 million euros in 2011 compared with the prior year's 511 million euros despite extraordinary charges of 138 million euros.

Feintool International Holding AG, a market leader in fineblanking technology, said that it has signed an agreement to acquire metal forming technology company Herzing+Schroth.

France-based biopharmaceutical company Flamel Technologies said it has agreed to acquire Missouri-based Éclat Pharmaceuticals that focuses on developing niche brands and generic products.

Siemens proposed to set up a major plant in the Dammam Industrial City of Saudi Arabia for manufacturing gas turbines, compressors and heat recovery steam generators as well as repair shops and service facilities for the Saudi market.

Telecom equipment maker Avaya Inc. said it has inked an agreement to acquire Israeli video conferencing company Radvision.

European shares largely finished to the upside on Wednesday, with upbeat comments by the Federal Reserve on the U.S. economy, a broadly positive stress-test result for U.S. banks and a successful auction of Italian bonds underpinning sentiment.

The Euro Stoxx 50 index of eurozone bluechip stocks finished 0.7 percent higher while the Stoxx Europe 50 index, which includes some major U.K. companies, edged up 0.3 percent. Around Europe, the German DAX rose 1.2 percent, France's CAC 40 gained 0.4 percent and Switzerland's SMI added 0.7 percent, but the U.K.'s FTSE 100 dropped 0.2 percent.

On Wall Street, the major averages bounced back and forth across the unchanged line before eventually ending Wednesday's session little changed, as traders digested the results of bank stress tests and seemed reluctant to make significant moves ahead of some key economic data later in the week, including reports on weekly jobless claims, industrial production, and producer and consumer price inflation.

by RTTNews Staff Writer

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