AZN gains on broker upgrade

Tuesday brought gains for European equities markets after the banking and airlines sectors produced positive earnings reports and broker upgrades.

In London, the FTSE 100 added 2.52 percent to 5,454.5 while the FTSE 250 gained 3.28 percent to 9,075.7 on Merrill Lynch (NYSE: MER; TYO: 8675) upgrades in the pharmaceuticals and airlines sectors.

Drug maker AstraZeneca (LSE: AZN; NYSE: AZN) jumped 2.49 percent on an upgrade while the broker also upgraded British Airways (LSE: BAY; NYSE: BAB) from “underperform” to “buy” on the chances that European Union regulators will approve a merger with Spain’s Iberia (IBEX-35: IBLA).

While the oil sector was down and miners were mixed, banks, retailers, and the real estate sector were all higher.

Elsewhere in Europe, the Eurofirst 300 was up 2.55 percent while the Paris CAC-40 was 2.47 percent higher to 4,386.35, the IBEX added 2.65 percent to 11,751.4 and the Dax gained 2.66 percent to 6,518.7.

In the banking sector, Societe Generale (Euronext: GLE) jumped 9.4 percent even though profits were down 63 percent in the second quarter after write downs in that quarter were less than half of those in Q1 while among airlines Air France-KLM (Euronext: AF; NYSE: AKH) added 9.35 percent on better than expected quarterly profits.

Utilities, oil, and the steel sector all saw declines on the session, but the semiconductors sector was higher.

Equities markets in the Asia-Pacific region were lower again as miners and the oil sector saw declines as commodities prices continued to decline, the steel sector was lower, and shipbuilders saw losses on cancelled orders.

In Tokyo, the Nikkei 225 was down 0.14 percent to 12,914.66 while the Topix index fell 0.04 percent to 1,247.71 and the Mothers market dropped 0.83 percent to 472.52.

The oil sector was lower as crude oil prices dropped, but papermakers benefited from the declines on speculation that the cost of fuel will not eat up as much profit as had been feared, with Nippon Paper (TYO: 3893) adding 13 percent on the session.

The steel sector was also down, with JFE (TYO: 5411) down 7.2 percent and Nippon Steel (TYO: 5401) dropping 4.9 percent, while traders also saw declines.

On the other hand, tire makers saw gains and the consumer credit sector was up on talk of a merger within the sector.

Elsewhere in the region, the Kospi was down 0.49 percent to 1,535.54 and the Straits Times Index fell 0.54 percent to 2,860.51 while in Australia the S&P/ASX200 was 1.38 percent lower to 4,820.4 and the Sydney Ordinaries dropped 1.52 percent to 4,882.

The Shanghai Composite was 1.86 percent lower to 2,690.75, the Taiex was down 2.35 percent to 5,813.4, and the Hang Seng fell 2.51 percent to 21,949.75.

India’s Sensex was one of the few gainers on the day, adding 2.63 percent to 14,961.07.

At midday in New York the Dow Jones Industrial Average had added 1.83 percent to 11,490.22 while the Nasdaq Composite was up 1.65 percent to 2,323.29 and the S&P 500 was 1.76 percent to 1,270.97 on lower prices for oil and other commodities and after service sector activity fell less than had been anticipated in July.

Carmakers and travel related shares were helped by the lower cost of fuel, with General Motors (NYSE: GM) adding 4.5 percent and US Airways (NAS: LCC) was 8.5 percent higher.

Retailers saw gains, with Macy’s (NYSE: M) up 8.3 percent and Sears (NAS: SHLD) jumped 10 percent, while banks were up on speculation that interest rates will stay steady at least through October.

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