MORNING WRAP

By webmaster on June 20th, 2006

** ASIAN MARKETS **
Nikkei -1,43%; Kospi -2,1%; HSI -1,25%; Taiwan -3,33%; China -0,2%; India
-1,22%; Thailand -1,96%; Australia -1,09%

** HEADLINES **
– Inflation Ravages U.S. Wages, Fueling Income Disparity, Angst About Bush
- Intelsat, Healthsouth, Libbey Bond Sales Struggle as Investors Flee Risk
- Housing Starts in U.S. Probably Remained Close to 17Month Low During May
- Mack’s Merger Caution, Talent Rebound Fail to Propel Morgan Stanley Stock
- Univision May Receive at Least Two Takeover Bids of More Than $13 Billion
- Yen Gains as Fukui Says BOJ Should Adjust Monetary Policy `Without Delay’
- U.S. Treasuries Little Changed; Report Today May Signal Housing Slowdown
- Copper in London, Down 25 Percent Since May, Slumps as Growth Outlook Dims
- Oil Trades Near $69 After Falling as U.S. Gasoline Stockpile May Increase
- Honda Bets Scientists in Secret Lab Can Outsmart Toyota With Clean Diesel

** BOJ **
- The yen rose after Bank of Japan Governor Toshihiko Fukui said policy should
be adjusted ``without delay’’ and as minutes from the last central bank
meeting said a weaker dollar won’t hurt Japanese companies. Real interest rates
are at extremely low levels and could risk stimulating growth excessively, Fukui
said today in a speech at the Japan National Press Club in Tokyo. The yen has
risen 2.2 percent this year on speculation the bank will end its five-year
policy of keeping borrowing costs near zero percent.

** EUROPEAN MARKETS **
S&P future 0,06%; Bund future 0,03%; Crude future 68,98; â‚¬/$ 1,25875; Gold
568,75

** EUROPE: IN PLAY TODAY **

- Mittal Steel board member Francois Pinault criticized the methods used by
Arcelor to fend off Mittal’s takeover bid, claiming it used up its cash reserves
for share buybacks and ceded control to a competitor, OAO Severstal (Le Figaro).

- Air France-KLM Group said members of the SkyTeam airline marketing alliance
have received a so-called statement of objections from the European Commission.
The alliance is “confident” they can settle the case “amicably” the statement
said. The stock’s target price was raised 9.2% to E23.80 by Citigroup.

- BNP Paribas agreed to buy Harrington Bannon, an Irish property consultant for
an undisclosed amount. The purchase will be completed July 1.

- EADS’ ended a meeting without commenting on its Co-Ceo’s future, claiming the
session had addressed how to avoid delays in producing the Airbus A380.

- PPR agreed to sell its Printemps department stores for over E1.1bln in a
leveraged management buyout supported by Deutsche Bank.

- Bayer moved closer to winning the necessary stake to complete its E17bln
acquisition of Schering after buying enough shares to control 64% of the group.

- Deutsche Boerse offered to keep the technology and stock trading platform of
Euronext but refused to raise its bid for the exchange as it seeks to thwart a
takeover by NYSE Group.

- E.ON, which is trying to take over Endesa, holds press conference.

- Workers at Volkswagen’s main German plant plan to strike today to put pressure
on management to reach a contract agreement with them.

- Premiere to outline future business strategy at a press conference.

- British Energy expected to report a surge in FY pretax profit, before
exceptional items and goodwill of to Â£588m from Â£232m a year earlier.

- Old Mutual Market scheduled to release an update on its integration with
Skandia

- Novartis is recalling a patch of its Triaminic children’s cough and cold
medicine after it was linked to causing seizures in children who had taken the
product.

- Logitech is powering the Video Call feature in the new Windows Live Messenger
platform, unveiled by Microsoft.

** EUROPE: UPS & DOWNS **
+ NOKIA PRICE ESTIMATE RAISED 6% TO EU17.5 AT ING
+ FRAPORT RAISED TO `OVERWEIGHT’ FROM `UNDERWEIGHT’ AT HSBC
+ LLOYDS TSB PRICE ESTIMATE RAISED TO 620P FROM 610P AT DEUTSCHE
+ CAPGEMINI PRICE ESTIMATE RAISED TO EU43 FROM EU40 AT DEUTSCHE
+ AIR FRANCE PRICE EST. RAISED 9.2% TO EU23.80 AT CITIGROUP
+ ARM HOLDINGS RAISED TO `BUY’ FROM `HOLD’ AT DEUTSCHE BANK
+ VOESTALPINE FY06/07 EPS EST. RAISED 21% TO EU20.5 AT JPMORGAN
+ VINCI RESUMED `OVERWEIGHT’ AT MORGAN STANLEY
+ SIEMENS PRICE EST. RAISED TO EU87 FROM EU79 AT MORGAN STANLEY
+ LLOYDS TSB PRICE ESTIMATE RAISED TO 545P FROM 540P AT UBS
+ EASYJET PRICE ESTIMATE RAISED TO 460P FROM 405P AT UBS
+ VEOLIA ENVIRONNEMENT RAISED TO `NEUTRAL’ FROM `REDUCE’ AT UBS

- ISRAELI STOCKS CUT TO `UNDERWEIGHT’ AT HSBC
- NOVO-NORDISK PRICE EST. CUT TO DKK385 VS DKK425 AT DEUTSCHE
- Eiffage Cut to `Hold’ at Citigroup
- LG ELECTRONICS CUT TO `EQUAL WEIGHT’ AT MORGAN STANLEY

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