European markets have had a good run since the European Central Bank confirmed its willingness to wade into the bond markets to buy sovereign debt of Eurozone countries, but today looks like a day when investors are in the mood to bank profits.

Banks are hardest hit, with Commerzbank the biggest faller in Frankfurt, while Societe Generale and Credit Agricole are sharply lower in Paris.

Airbus owner EADS leads the fallers in France after Barclays suggested holders pare their holdings in the wake of yesterday's news about a possible tie-up with UK defence firm BAE Systems, while Deutsche Bank downgraded the stock to "hold" from "buy".

BAE also took a buffeting, as Oriel Securities cut its recommendation to "hold" from "buy".

In other broker action, building firm Vinci was cut to "neutral" from "buy" by Bank of America, but Zodiac Aerospace gained altitude after Societe Generale upgraded it from "sell" to "hold".

On the commodity markets, the front month contract for Brent Crdue is up $1.12 to $117.08 a barrel, while gold is in favour, with the most widely traded contract up 90 cents to $1,734.60.

In the Netherlands, Prime Minister Mark Rutte's VVD party appears to have secured the most seats, by a whisker; the VVD party is projected to win 41 seats, while the centre-left PvdA party is forecast win 39 seats in the 150-seat lower chamber of the Netherlands' parliament.

"Although VVD leans more toward the right wing and PvdA toward the left, we nevertheless consider these two parties sufficiently close to be able to build a ruling coalition," stated Francois Cabau of Barclays.

"They could further strengthen the future ruling coalition by accepting other parties, such as D66 and the Christian Democrats, allowing them to control the Upper House as well," Cabau added.

A confirmed win by the VVD party would likely be a welcome outcome for markets, Cabau reckons, "given the party's commitment to bringing the general government public deficit to GDP [gross domestic product] ratio within the Maastricht criteria by next year.

"While the labour party is fundamentally pro-European also, it had not made such an explicit commitment in its manifesto; however, we expect it would follow suit with the VVD on that front," Cabau opined.

DAX - Risers
Merck € 96.35 +2.14%
MAN € 74.04 +0.89%
Beiersdorf € 56.65 +0.53%

DAX - Fallers
Commerzbank € 1.54 -2.16%
Deutsche Bank € 32.37 -1.91%
Infineon Technologies € 5.70 -1.01%

CAC 40 - Risers
Alcatel-Lucent (ALU) € 0.96 +1.26%
Michelin (ML) € 62.44 +0.87%
Publicis Groupe Sa (PUB) € 43.99 +0.79%
Renault (RNO) € 39.60 +0.52%
Essilor International (EI) € 73.08 +0.50%
Pernod Ricard (RI) € 86.27 +0.49%
L'Oreal (OR) € 97.30 +0.31%
Sanofi (SAN) € 67.44 +0.24%
Unibail-Rodamco (UL) € 162.75 +0.12%
Total (FP) € 41.08 +0.07%

CAC 40 - Fallers
EADS (EAD) € 25.53 -8.80%
Vinci (DG) € 35.57 -3.30%
Credit Agricole (ACA) € 5.71 -3.06%
Schneider Electric (SU) € 50.47 -2.66%
Societe Generale (GLE) € 24.09 -2.57%
Technip (TEC) € 87.18 -2.18%
Peugeot (UG) € 6.73 -2.04%
Bouygues (EN) € 20.22 -1.82%
Vallourec (VK) € 36.09 -1.80%
France Telecom (FTE) € 10.60 -1.76%

JH

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