Advances made in US and Europe

MARKET OUTLOOK

- US: US markets continued their advance week-on-week, driven by renewed mergers and acquisitions activity and positive economic results. Stocks from the materials, real estate, telecom services and capital goods sectors outperformed the market. From a technical point of view, the current bounce should continue as all US indexes have drawn a classical three downwaves pattern consolidation.

- EUROPE: European markets were up last week helped by reassuring data. Although, all sectors made important progress last week, shares from basic resources, travel and leisure, industrial goods and services and automobiles and parts were among the best performers. Technically, the bias should remain positive as indicators are reversing up and posting some bullish divergences.

COMPANY PREVIEW

DaimlerChrysler (EUR 63.06 ; 4.86% ; DAI ; DAIGn.DE)

Wednesday, DaimlerChrysler is seen reporting Q2 net income of appx. E1.04bn (E1.81bn a year ago) on revenues of E37.77bn. Moreover, on the same day the Co may announce details of how it plans to use its excess cash (Handelsblatt). Last week, the Financial Times reported that DaimlerChrysler managed to buy the rights to rename itself as Daimler from Ford Motor. Earlier this month the group boosted Northeast Asia sales of Mercedes-Benz luxury sedans by 24% to 22,038 cars in H1.

Big Lots (USD 27.62 ; 9.82% ; BIG ; BIG.N)

In the US, Big Lots may announce Q2 EPS of $0.10 ($0.04 last year) on sales of $1.08bn ($1.05bn). On August 9, Big Lots reported that Q2 retail sales increased 2.8% year-on-year to $1.07bn, while comparable store sales grew 5.2%, beating the Co's guidance of 2%-4% growth.

Novell (USD 6.93 ; 4.53% ; NOVL ; NOVL.O)

Novell will post its earnings for the Q3 at 4pm on the same day. Q4 EPS is expected to reach $0.01 (LPS of $0.02 a year ago) on sales of $234.4m ($241.4m). A week ago, the Co agreed to acquire Senforce Technologies to expand its computer security offering. Separately, Novell has recently won a lawsuit against SCO Group over royalties from users of the Linux computer operating system.

Dell Computer (USD 27.74 ; 5.4% ; DELL ; DELL.O)

Dell could release Q2 EPS of $0.30 ($0.22 a year ago) on sales of $14.09bn ($14.57bn) on Thursday. On August 21, Dell posted the biggest sales gain among server makers for Q2, earning a fourth place ranking in the market for computers used to run websites and corporate networks. The Co's sales for the period rose 20% and amounted to $1.56bn. At the beginning of the month, the group was awarded a contract valued over $248m to provide desktop computers to the US Veterans Affairs Department.

EDF (EUR 73.26 ; 5.62% ; EDF ; EDF.PA)

Finally, on Friday, Electricite de France is scheduled to publish H1 net income of E3.06bn (E4.14bn last year). Last week, the Co started six nuclear reactors and halted one in France. Year to date, the stock is up 32.7% versus a 0.5% gain for the Cac 40 index. Technically, the stock is trading between its 20d and 50d moving averages.