European car and airline stocks fell, paced by PSA Peugeot Citroen and British Airways Plc, after crude oil rose above $50 a barrel to a record in New York. Oil producers' shares gained. ``Airlines and auto stocks will be affected'' by the rising oil price, said Thierry Cantet, a strategist at Societe Generale. ``This poses a problem for corporate profits.'' KarstadtQuelle AG, Europe's largest department-store retailer, and Swiss insurer Converium Holding AG slid after both companies announced plans to sell new shares.
The Dow Jones Stoxx 600 Index fell 0.1 percent to 237.22 as of 8:28 a.m. in London, with 15 of its industry groups declining and three advancing. The Stoxx 50 added less than 0.1 percent and the Euro Stoxx 50, a benchmark for the 12 countries using the euro, slipped 0.2 percent. Peugeot, Europe's No. 2 carmaker, slipped 0.4 percent to 49.79 euros. The two biggest airlines in Europe, Air France SA and British Airways Plc, added to yesterday's declines. Air France slid 0.5 percent to 12.8 euros while British Airways lost 0.9 percent to 204.5 pence. Deutsche Lufthansa, Europe's third-largest airline, fell 1.1 percent to 9.16 euros. The International Air Transport Association, or IATA, said it expects 2004 airline industry fuel costs to rise by a quarter to $50 billion. Crude for November delivery rose to as much as $50.45 in New York on concern rebels may attack oilfields in Nigeria, Africa's biggest oil producer, at a time when U.S. inventories are close to a 29-year low. Oil producers such as Total SA, Europe's biggest oil refiner, and BP Plc, Europe's biggest oil company, gained. Total added 0.3 percent to 169.9 euros. BP advanced 0.4 percent to 534 pence. The Stoxx 600 oil group added 1.1 percent, the biggest gain among subindexes.
Karstadt, Converium
KarstadtQuelle lost 4 percent to 12.85 euros. The German retailer announced it would raise 1.6 billion euros ($2 billion) by selling shares and assets before the end of next year to revive revenue growth and return the company to profit. KarstadtQuelle will hold a press briefing at 10 a.m. local time. Converium, the Swiss reinsurer that had a record quarterly loss after underestimating claims, slid 11 percent to 17.4 Swiss francs. It will sell 533 million Swiss francs ($422 million) worth of new shares at a 74 percent discount to the current price. The company said yesterday it decided against trying to sell a stake to an investor. The insurer plans to offer the shares for 92 percent less than on July 19, the day before it said it found a reserve deficiency of as much as $400 million for claims.
Pinault, Hoteliers
Pinault-Printemps-Redoute SA gained 0.7 percent to 74.2 euros. The French company's Gucci Group business, the world's No. 3 luxury goods maker, said operating profit more than doubled on demand for its fashions in the U.S. and Asia. Sales rose 9.8 percent. Pinault's share-price forecast was raised at BNP Paribas, which raised the stock to ``outperform'' from ``neutral''. Hotel stocks dropped after UBS AG called the industry ``oversupplied.'' Accor SA lost 1 percent to 30.95 euros. The world's fourth-largest hotelier was downgraded to ``neutral'' from ``buy'' at UBS and its share-price forecast cut 13 percent to 34 euros. Hilton Group Plc, the operator of Hilton hotels outside the U.S., tumbled 1.3 percent to 273.5 pence after its share forecast was lowered 3 percent to 315 pence.
Electrabel, Scor
Electrabel SA shed 1 percent to 296.2 euros, cutting its surge this month to 7 percent. Belgium's largest power utility said Chief Executive Willy Bosmans will resign at the end of 2004, raising speculation that majority shareholder Suez SA may bid for the rest of the company, according to analysts. Suez fell 0.6 percent to 17.04 euros. Scor SA dropped 5.6 percent to 1.19 euros. France's largest reinsurance company said recent hurricanes and floods cost the company 30.5 million euros before tax and will affect third- quarter profit. Benchmarks tumbled in the U.S. and Asia. The Dow Jones Industrial Average shed 0.6 percent to 9988.54, the lowest since Aug. 17. The Nikkei 225 Stock Average lost 0.4 percent. ///www.bloomberg.com