Rumors of mergers in Europe’s aerospace and defense sector sent European equities higher on Tuesday even though the oil sector declined as crude oil prices continued to drop. The FTSE Eurofirst 300 ended the session at 1,367.4. 0.2 percent lower.
Defense electronics company Thales and airplane engine manufacturer Safran were both said to be interested in bidding for French aeronautical supply company Zodiac. While Zodiac denied the rumors, all three companies saw gains on the session. Thales added 2.8 percent to €33.67, while Safran gained 4.5 percent to €16.79 and Zodiac was 6.8 percent higher to €47.69. In addition Alcatel, owner of 10 percent of Thales, was up 1.2 percent to €9.61.
Among oil companies, Cepsa dropped 2.1 percent to €55.50, Statoil declined by 3.2 percent to NKr168.50 and OMV was 3.7 percent lower to €41.25.
The semiconductors sector was helped by a prediction from Japanese company Elpida Memory that its sales could double this year. Infineon was 1.6 percent higher to €9.17 and ASML added 1.9 percent to €16.78. A reconfirmation of Merrill Lynch’s “buy” recommendation sent STMicroelectronics up 2.1 percent to €12.96.
In the transport sector, Danish container shipper Moller-Maersk added 3.1 percent to DKr46,900 as it said that its net profits in the first half dropped less than they had been expected to decline.
Drugmaker Bayer was down 0.7 percent to €39.26 even though its second quarter core earlings were up 14.1 percent, more than had been forecast. Elsewhere in the pharmaceuticals sector, Roche added 0.5 percent to SFr226.80 and Novartis was 0.6 percent higher to SFr70.50, both helped by the approval in Switzerland of Lucentis, a blindness treatment.