LONDON (The Deal) -- Markets were treading water in Europe Wednesday after similarly subdued trading in Asia and the U.S. overnight. Traders are waiting for the release of U.S. housing starts data and the minutes of the Federal Reserve's January meeting. But individual stocks moved sharply on a series of big industrial announcements.
Most spectacular was French car producer PSA Peugeot Citroen's announcement of a deal with the French government and its longstanding Chinese partner, the automaker Dongfeng Motor Group. The government and Dongfeng will each inject 800 million euros ($1.1 billion) into the company and the carmaker itself will to raise additional cash from its existing shareholders and the market, so that, at the end of the process the state and Dongfeng will each own 14% of the company. It's being touted as a win for all: The carmaker survives its current cash crunch, despite posting a (much reduced) full year loss of 2.3 billion euros, the government looks good helping a national champion and the Chinese group gets access to the best French technology. Peugeot was up over 6% in early trading, though it fell back somewhat later.
In Britain, defense contractor BAe Systems opened up 4% on news that it has agreed pricing terms with Saudi Arabia for 72 Eurofighter Typhoon jets after years of negotiation. Details were scant and the share price had begun to fall back by mid-morning, but analysts said the news had reduced some of the uncertainty overhanging the company.
The value of the pound took a knock and but the stock market seemed largely unaffected by the news that British unemployment, which has been falling rapidly for months, showed an unexpected uptick in the final quarter of 2013, rising 0.1% to 7.2%.
The Danish brewer Carlsberg rose over 5% after announcing better than expected fourth quarter results -- and particularly heady progress in Asia. But German airline Lufthansa hit some turbulence after news broke that its offices had been raided by investigators in a corruption probe. The stock stalled, recovered altitude then descended again. It was down 0.5% mid-morning.
In Paris, the CAC40 was down 0.03% at 4330. London's FTSE 100 was up 0.09% at 6802 and Frankfurt's DAX index was down 0.14% at 9646.
Meanwhile in Asia, Tokyo closed down after the previous day's euphoric reaction to continued economic stimulus by the Bank of Japan. The Nikkei 225 was down 0.52% at 14,766.53