Friday, April 15, 2005

Fiat hits all-time low as recovery fails to show

Reuters

Copyright © 2004 Reuters Ltd. Click for Restrictions.

Comment on this story Send this story to a friend Get Home Delivery

MILAN - Fiat shares hit an all-time low of 5.05 euros on Friday as investors searching for any sort of recovery at the Italian group's core car arm were disappointed by recent data, traders said.

Fiat shares have long bounced around the 5.80 euro mark but started to slip over the past month before sliding on Friday.

The DJ Stoxx index of European auto stocks was 1.4 percent lower on Friday, dragged down by growing pessimism over a sector blighted by weak sales, high raw material costs and steep pressure on prices, where Fiat has little room to move.

Fiat is still failing to stem a steep slow-down in its car sales. In the first quarter, its registrations in the key western European bloc fell 15 percent year-on-year against an overall market drop of 2.5 percent.

"We're not seeing any recovery. Recent data is very discouraging," said one Milan-based trader, who said there was no other specific reason behind Friday's stock fall.

Last week, Fiat said it was delaying its annual shareholders' meeting for "technical reasons".

Media speculated Fiat was re-negotiating a 3 billion euro loan which banks must convert into stock in September, a move that would require shareholders to approve a capital increase.

Giovanni Agnelli & C, the holding company at the top of Fiat's chain of command, would meet later on Friday to discuss financial results, a source closing to the holding company said.