30.11.2010

Nordic markets ended the day relatively unchanged after a random walk pattern with a flat trend. The data came pretty close to expectations today. Some bond yields were also rising in what seems to have become a new norm; a new day with new European country being asked questions about the health of its banking sector or sovereign debt. Today most of the onus was placed on Spanish and Italian shoulders. China has postponed FTA negotiations with Norway indefinitely. The Chinese said they need more time to prepare for the negotiations concerning the agreement. The negotiations had been scheduled to take place soon. Now there are those who think that this is rather due to something else than an inability to adhere to scheduled timelines, namely further Nobel backlash.

ABB announced that the company will purchase industrial electric motors, drives, and generators firm Baldor (NYSE listed) for 4.2 billion USD in cash. The company sees considerable cost synergies (up to 100 million USD per year). Most of the analysts seem to agree but there is more debate about the relatively high price tag. ABB gained slightly in today’s trading.

Finnair gave a profit warning after another strike has grounded most of its flights (I have lost count on how many they’ve had this year alone), this time from cabin personnel. Change resistance is very high in the company that has provided returns on capital employed at unacceptable levels for as long as anyone can remember. The management is starting to come up with some more potential ideas, like taking a page out of Norwegian’s playbook and hiring cabin personnell from other countries, but it is doubtful if they have the guts to think about company shareholders any more than past managers have done.

Seadrill’s operating profit for Q3 was 431 million USD. The company declared a dividend of 0.65 USD per share. The result was somewhat worse than expected and the stock fell slightly. BW Offshare and Eidesvik Offshore fared better in their reports and gained 4% and 5% respectively.

Domstein gained over 20% after announcing that an extraordinary dividend of 1.94 NOK will be proposed for extraordinary general meeting in December. Wentword Resources Limited also managed to gain more than 20% after announcing a natural gas discovery offshore of Mozambique by Anadarko Petroleum, out of which Wentworth will receive royalties. Those who followed a major insider purchase in Wentworth yesterday got a nice payday.