LONDON -- European equity markets are continuing to trade lower Wednesday, though they were off session lows heading into the Wall Street open, pressured by a number of weak earnings results and ongoing fears surrounding the European debt crisis. These fears were highlighted as the Spanish region of Catalonia said it would request a 5 billion euro credit line from the national government to help it cover its refinancing costs.
Attention has also been turning to the meeting of central bankers at Jackson Hole, Wyo., and the notable absence of the European Central Bank's Mario Draghi due to a "heavy workload" has many hoping the ECB will announce strong action to address the European debt crisis when it meets next week. The Spanish IBEX
As always, the following price moves are based on this morning's European trading.
French building, telecommunications, and television company Bouygues (NASDAQOTH: BOUYY.PK) has plummeted more than 7.6% in Paris today after it cut its 2012 profit forecast for its phone division due to an increase in competition. The company, France's third-largest phone operator, said first-half profits fell 37% year on year to 476 million euros as mobile-phone customers moved away from the company and into smaller new entrants to the market.
The company said earnings before interest, taxes, depreciation and amortization will likely be 900 million euros this year, although this excludes the cost of a 150 million euro restructuring plan. Bouygues' telecoms arm said it would shed 556 jobs to counter the loss in revenue and scale back marketing and distribution expenditure in order to save around 300 million euros.
Meanwhile, Finnish phone maker Nokia
French beauty product maker L'Oreal (NASDAQOTH: LRLCY.PK) is being hit hard today, down 4.5% after it reported weakening profit margins due to a slide in the euro. Gross profit margin fell to 71% in the first half of the year -- lower than last year's 71.5% and the majority of estimates in the 72% region. The company said that along with a soft euro, an increase in promotional offers and the consolidation of Clarisonic -- a maker of skincare devices which L'Oreal agreed to buy at the end of 2011 -- has brought about the poor performance.
On a more positive note, Telekom Austria (NASDAQOTH: TKAGY.PK) is up almost 5% today after its CEO, Hannes Ametsreiter, said the company will announce its first money-saving tactics with new investor America Movil in early December. Ametsreiter said the companies have been discussing potential synergies in purchasing and wholesale, as well as content, and that Telekom Austria will be having similar discussions with Dutch firm Royal KPN.
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Karl Loomes does not own any share mentioned in this article. The Motley Fool has a disclosure policy.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.