Historical highs for Dow Jones and S&P500

MARKET OUTLOOK

- US: US markets had another positive week helped by reassuring economic data. The May (prelim) University of Michigan Consumer sentiment and the April CPI were both above expectations. The Dow Jones and the S&P500 reached new historical highs. Shares from energy, telecom services, transportation and automobiles led the advance week-on-week while stocks from real estate, semiconductors and retailing lost ground. Technically, as daily indicators remain positive, a further rise is favoured in the forthcoming days.

- EUROPE: After a weak start, European markets had a strong bullish acceleration on Friday. Most of the major indices managed to achieve new year highs. Stocks from oil and gas, automobiles, technology had a sharp rise week-on-week while shares from telecommunications, food and beverage and basic resources were among the worst performers. Technically, on major European indices, the clearing of their former resistance levels now pleads for a continuation of the rise.

COMPANY PREVIEW

Medtronic (USD 51.25 ; -4.06% ; MDT ; MDT.N)

Tuesday, Metronic is seen delivering 4Q EPS of $0.62 ($0.61 last year) on sales of $3.28bln ($3.06bln). The Co has recently announced about its partnership with Johnson and Johnson on developing and promoting treatments for irregular heartbeats. Earlier, in March the Metronic won the lawsuit over the patent infringement against Cross Medical Products.

Dexia (EUR 24.41 ; 0.54% ; DEXB ; DEXI.PA)

Dexia is expected to post 1Q net income of E545m (E767m last year) on Wednesday. In March, Dexia and Societe Generale shares boosted by rumours that the Cos could become takeover targets. Also, in March, the Co sold its life-insurance unit Belstar to Ethias. Terms were not disclosed.

Target (USD 58.15 ; -0.17% ; TGT ; TGT.N)

In the US, Target is seen reporting 1Q08 EPS of $0.71 ($0.61 last year) on sales of $14.23bln ($12.86bln) on the same day. The Co reported that April sales decreased 1.8% to $3.9bln, while March sales rose 12% on purchases of Easter items. Target, as well as Wal-Mart Stores, Best Buy and other discount retailers are progressively making the rules in the US music industry (WSJ).

Air France-KLM (EUR 35.75 ; -2.19% ; AF ; AIRF.PA)

On Thursday, Air France may release FY07 net income of E808.4m (net income of E913m last year) on revenue of E23.2bln (E21.44bln). The Co is actually in discussions with China Southern Airlines to set up code-sharing connections through Guanghzhou and Beijing to 14 cities in China this year (WSJ on 10 May). Some time earlier, in April, Air France-KLM Group was considering buying stakes in Delta Air Lines and Northwest Airlines (La Tribune on April 13).

Gap (USD 18.44 ; 0.66% ; GPS ; GPS.N)

Still on Thursday, Gap will announce 1Q07 EPS of $0.23 ($0.28 last year) on sales of $3.34bln ($3.44bln). At the beginning of the month, the Co declared that it plans to eliminate an unspecified number of jobs to reduce costs. The group added that lay-offs were part of the cost cutting plan and would affect a small percentage of the staff (Post).