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Retailers Casino, Carrefour support European shares

Published 06/12/2018, 04:15 AM
Updated 06/12/2018, 04:20 AM
© Reuters.  Retailers Casino, Carrefour support European shares
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By Danilo Masoni

MILAN (Reuters) - European shares steadied near their highest level in almost a week on Tuesday with Casino (PA:CASP) leading gainers as investors warmed to the French supermarket's plans to sell assets.

Its shares rose as much as 9.6 percent after it said it aimed to complete 1.5 billion euros of asset sales by early 2019 to reduce its heavy debt burden.

"While some components of the assets disposal remain unclear, the strength of the French business and the net debt reduction are clearly positive," Deutsche Bank (DE:DBKGn) analyst Maxime Mallet said.

He said shares, which are down 31 percent year-to-date, were trading at a discount to European peers, which was attractive.

Carrefour (PA:CARR) was another strong gainer, up 2 percent after France's largest food retailer agreed an online shopping tie-up with Google (NASDAQ:GOOGL). Their gains and strength across most sectors helped lift the pan-European index 0.2 percent by 0752 GMT.

Overall, markets were largely unmoved by a promise by the United States and North Korea made at a historic summit to work towards the denuclearization of the Korean peninsula.

"The vague wording of the document signed by Trump and Kim Jong-Un... resulted in a muted open in Europe," said Connor Campbell, analyst at Spreadex.

Later in the day investors will by eyeing U.S. inflation data which comes days before the Federal Reserve is widely expected to raise interest rates for the second time this year.

Among national benchmarks, the FTSE (FTSE) was flat, weighed down by weaker mining stocks on a key day in parliament for the Brexit process.

Europe's mining index (SXPP) fell 0.5 percent, as copper prices slipped on a stronger dollar, leading sectoral losers in Europe.

British American Tobacco (l:Bats) rose 0.5 percent after the FTSE heavyweight said it expected to weather a weaker pound and a slowing market for tobacco-heating devices in Japan to report "good" earnings growth for the full year.

"The first half trading statement is brief but reassuring, with the underlying business performance on track and FX headwinds lessening by another 2 percent since the previous update," said Investec analysts in a note.

A downgrade from Morgan Stanley (NYSE:MS) sent Rotor (L:ROR) shares down 1.3 percent, while Deutsche Post (DE:DPWGn) declined 1.2 percent after a downgrade from RBC.

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