European Stocks May Rise; Statoil, BP, BHP, Nestle May Gain

European stocks may advance for the first time in six days, paced by energy and mining shares as oil and metals prices rose.

U.S.-traded securities of Statoil ASA and BP Plc gained. BHP Billiton Ltd. and Rio Tinto Group rallied in Australian trading. Nestle SA, the world's largest food company, will probably increase after Deutsche Bank AG recommended buying the stock. Groupe Danone may be active on a report the yogurt maker will likely sell its LU cookies division.

Concern that higher borrowing costs will hurt profits has weighed on Europe's Dow Jones Stoxx 600 Index, which is heading for its first monthly decline in four months. The Federal Reserve today is expected to keep its benchmark rate at 5.25 percent.

``Stocks have been sold off for a while now,'' said Alain Bokobza, a strategist at Societe Generale in Paris, who prefers stocks to bonds. ``There will be a point when stocks would start to suffer from higher rates, but we still have some elbow room.''

Futures on the Euro Stoxx 50, a benchmark for the euro region, added 44 to 4489 at 7:34 a.m. in London. The U.K.'s FTSE 100 Index may increase 37, according to Cantor Index, a betting firm.

European stocks are ``a unanimous buy,'' Robert Buckland, London-based chief global equity strategist at Citigroup Inc., wrote in a report to investors. ``Right now, our two value strategies agree on one region. Europe ranks cheapest against other markets and its own history.''

The world's largest financial company distributed the note after European markets closed yesterday.

The U.S. stock market rebounded yesterday as a rally in oil prices lifted energy shares and better-than-expected profit at Oracle Corp. helped software companies. The Dow Jones Industrial Average gained 0.7 percent, while the Standard & Poor's 500 Index rose 0.9 percent. Asian stocks today rose from a two-week low.

Statoil, BP

American depositary receipts of Statoil, Norway's largest producer of oil and natural gas, rose 1.6 percent from the stock's close. ADRs of BP, Europe's second-largest oil company, added 0.7 percent from the share's close in the U.K. The Bank of New York European ADR Index increased 0.7 percent to 185.14.

Crude oil rose in New York, extending yesterday's $1-a- barrel gain, on concern that U.S. gasoline supplies during the peak demand season may not be adequate after a report showed an unexpected decline in inventories. The contract for August delivery climbed as much as 0.5 percent to $69.33 on the New York Mercantile Exchange.

Royal Dutch Shell Plc, Europe's largest oil company by market value, had its share-price estimate raised 14 percent to 2,300 pence at Morgan Stanley. The analysts lifted their recommendation on the shares to ``equal weight'' from ``underweight.''

BHP, Nestle

BHP Billiton, the world's biggest mining company, climbed 1.3 percent in Australia, while Rio Tinto, the third-biggest, added 1.4 percent.

``Metals and mining stocks remain in the super cycle,'' said Mark Tinker, a fund manager at Axa Framlington Ltd. in London. ``The fact is there is demand and supply imbalance and that gives pricing power.''

Nestle had the recommendation on its shares lifted to ``buy'' from ``hold'' at Deutsche Bank.

Danone, the world's largest yogurt maker, may sell its LU cookies division if it receives a satisfactory offer, weekly magazine Challenges reported, without saying where it got the information. Kellogg Co. and Kraft Foods Inc. are among the possible bidders, the magazine said.

Barry Callebaut AG, the world's biggest maker of bulk chocolate, said nine-month sales climbed 4.1 percent after it won orders from candy makers and lifted revenue from higher-margin gourmet brands.

HMV, Diageo

HMV Group Plc, the U.K.'s largest music retailer, said annual profit declined 71 percent as more people used the Internet to buy compact discs and download songs. HMV also said it's in talks that may lead to the sale of its Japanese unit.

Diageo Plc, the world's biggest liquor company, said revenue growth accelerated in the fiscal second half as more consumers bought its brands in Russia, Eastern Europe and Asia. Full-year operating profit will rise 8 percent on a basis that excludes acquisitions, Diageo said.

Hornbach Holding AG, Germany's fourth-largest home- improvement retailer, said first-quarter revenue advanced 5.2 percent to 732.7 million euros ($986 million). The company said it plans to increase the speed of expansion in fiscal 2009 and will open as many as nine new megastores during that period.

ABB Ltd., the world's largest builder of power networks, had its share-price estimate raised 15 percent to 30 Swiss francs at Deutsche Bank.

Remy Cointreau SA, France's second-biggest liquor maker, was raised to ``neutral'' from ``sell'' at Merrill Lynch & Co.

Northern Rock Plc, the U.K.'s fourth-largest mortgage lender, had its price estimate cut 18 percent to 920 pence at UBS AG. Deutsche Bank decreased its price estimate 19 percent to 790 pence.

Northern Rock yesterday said profit will probably miss analysts' estimates because of rising interest rates.

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