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Europe shares rise in early trade; Carrefour gains

Published 09/17/2010, 04:39 AM
Updated 09/17/2010, 04:41 AM
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* FTSEurofirst 300 up 1 percent

* Carrefour surges on hypermarket strategy

* Crucell soars on takeover approach

* Miners gain as gold, copper prices rise

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Brian Gorman

LONDON, Sept 17 (Reuters) - European shares rose in early trade on Friday, with Carrefour leading retailers higher on a plan to revamp its hypermarkets, and miners gaining after copper and gold prices rose.

Acquisitions news also boosted sentiment. At 0822 GMT, the FTSEurofirst 300 <.FTEU3> index of top European shares was 1 percent higher at 1,086.96 points, after falling 0.8 percent in the previous session.

The European benchmark soared 62 percent between hitting a lifetime low in March, 2009, and the end of the year. It has risen 5.9 percent in September, but it is up only 4 percent in 2010, on worries about European debt levels and the strength of the economic recovery.

"The bias of the market is to go up. That's not because it's getting good data, but it's inclined to wait for better data. It believes there won't be a double dip," said Bernard McAlinden, investment strategist at NCB Stockbrokers in Dublin.

Carrefour , the world's second-biggest retailer, rose 6 percent and hit its highest in more than two years after the group unveiled a 1.5 billion euro revamp of its European hypermarkets as part of a turnaround plan it hopes will more than double profits by 2015.

UK supermarket groups Tesco Morrison and Sainsbury rose between 1.8 and 1.9 percent.

Dutch biotech company Crucell soared more than 50 percent after U.S. healthcare company Johnson & Johnson said it was is in advanced talks to pay 1.75 billion euros ($2.3 billion) for the shares in Crucell it does not already own.

OPPORTUNITY COST

Copper rose after reassuring comments from China's central bank about its plans to keep monetary policy loose. Spot gold hit a new record high of more than $1,280 an ounce as investors remained concerned about economic prospects.

"Gold is in the ascendancy because investors believe interest rates will stay close to zero for quite some time to come. The opportunity cost of being in gold is very low," McAlinden said. Miners to gain included Kazakhmys , Rio Tinto , Vedanta and Xstrata , up between 1.4 percent and 2.1 percent.

BHP Billiton rose 1.1 percent, shaking off a downgrade to "neutral" by HSBC on concerns about a planned acquisition.

"The merit of the bid for Potash Corp swings on what the combination will create. Increased diversity and a different approach to marketing do not create value in our view," the broker said in a note. Across Europe, Britain's FTSE 100 <.FTSE>, Germany's DAX <.GDAXI> and France's CAC40 <.FCHI> rose between 1 and 1.4 percent.

The Euro STOXX 50 <.STOXX50E>, the euro zone's blue-chip index, rose 1 percent to 2,811.44 points -- rising above 2,805.95, the 61.8 percent Fibonacci retracement of the index's fall from an April high to a May low.

Some traders were cautious ahead of triple witching, when contracts for stock index futures, stock index options and stock options all expire at the same time.

European technology companies gained after U.S. group Oracle posted a 25 percent surge in software sales, sharply beating forecasts, and a pickup in its new hardware business, underscoring robust tech spending by corporations.

SAP , Infineon , and Software AG rose between 1.6 and 2.9 percent.

Denmark's TDC rose 5.9 percent after agreing to sell its Swiss unit Sunrise Communications AG to funds advised by private equity firm CVC Capital Partners for 3.3 billion Swiss francs ($3.3 billion).

Later in the session, investors' attention will turn to U.S. data, including inflation and the latest readings on the economy from the University of Michigan. (Editing by David Holmes)

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