AFX News Limited: Amsterdam shares close higher; Royal Dutch Shell gains on M&A talk UPDATE

05.18.07, 1:36 PM ET
(Updates with full report)

AMSTERDAM (Thomson Financial) – Shares closed higher in Amsterdam as heavyweight Royal Dutch Shell surged on continued M&A talk, while steel giant Arcelor Mittal led gainers following target price upgrades at various brokerages, dealers said.

The AEX closed up 5.16 points or 0.97 pct at 536.69 after opening at 531.41 and trading in a range of 531.41-538.29.

Government bonds traded mainly higher while the euro stood at 1.3511 usd, against 1.3491 usd late yesterday.

Arcelor Mittal led gainers, rising 2.75 pct to 43.73 eur, as Exane and UBS became the latest brokers to make positive comments on the steel maker’s prospects following its quarterly results on Wednesday.

But the main story of the day was Royal Dutch Shell, which put on 2.24 pct to 27.41 amid ongoing speculation of a possible merger with BP. Shell also gained 3.23 pct yesterday.

Other heavyweights also traded higher, with Philips rising 1.59 pct to 30.63 eur amid positive broker sentiment and news that it has sold part of its stake in Taiwanese semiconductor maker TSMC.

ABN Amro put on 0.28 pct to 35.30 amid reports that the Royal Bank of Scotland consortium is close to a deal with Bank of America on the break-up of ABN’s LaSalle unit, giving rise to speculation the consortium will move ahead in the bidding war with Barclays for the ABN Amro group.

Peer financials also gained, with Fortis up 1.18 pct at 32.45 and Aegon gaining 1.32 pct to 15.38, while ING was unchanged at 33.20.

Blue chip property stock Rodamco Europe put on 2.22 pct to 103.08, ahead of Monday’s EGM French peer Unibail will hold to discuss the planned merger between the two companies.

Dutch sector peer Corio led midcap gainers, putting on 3.80 pct to 65.01 eur.

TomTom put on 1.41 pct to 30.87 as ABN Amro issued a bullish note saying that its 2007 forecasts for the company’s US volumes might be too modest and reiterated its ‘buy’ rating.

TomTom supplier Tele Atlas put on 1.27 pct to 15.95.

Unilever gained 0.14 pct to 22.17, recovering from an intraday low of 21.75 after it was downgraded to ‘neutral’ from ‘buy’ at Goldman Sachs on valuation grounds.

Heineken gained 0.05 pct to 40.18 after the stock was initiated at UBS today, with a price target of 35.60 eur. The brokerage gave given the Dutch beer giant an initial rating of ‘neutral 1.’

Among midcap gainers, SNS Reaal put on 1.51 pct to 17.50 and ASMI gained 1.31 pct to 19.37.

There were just four decliners on the AEX, led by ASML which shed 0.42 pct to 18.86.

KPN shed 0.33 pct to 12.16 eur amid news Deutsche Telekom unit T-Mobile Netherlands is taking legal action against KPN subsidiary Telfort on claims the mobile operator is staging a misleading marketing campaign.

On the midcap, Boskalis Westminister fell 0.24 pct to 78.85 ahead of its 3-for-1 share split tonight.

Aaron Gray-Block; [email protected]

agb/lam

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