|
FTSE bulls rampage
|
 |
April 22, 1999: 4:53 p.m. ET
London's blue chips recoup some past-session losses as Dow shines
|
LONDON (CNNfn) - European markets closed mostly higher Thursday, driven by a continuing Wall Street rally and news of a trans-national telecom merger.
After gapping sharply higher at the open on the back of IBM's stellar after-hours earnings report, the FTSE 100 remained buoyant throughout the session and into the homestretch, closing up 1.6 percent, or 102.6 points, at 6,413.6, amid sharp gains in telecom and supermarket stocks.
At one point, the index had advanced 146 points as investors took heart from a rally in the Dow Jones industrial average.
The rally helped the FTSE 100 to recoup much of its steep loss from Tuesday, when the index slid 195 points amid Nasdaq-sparked technology jitters.
Frankfurt's electronically-traded Xetra Dax gained nearly 1 percent to end at 5,226.64, a rise of 51.07 points, while Switzerland's SMI added 0.77 percent to 7,179.8. In Paris, the CAC 40 finished virtually unchanged at 4,291.85 as investors displayed frayed nerves over Wall Street's short-term outlook.
In Frankfurt, and elsewhere across Europe, telecom talk was on almost every investors' lips Thursday as Deutsche Telekom (FDTE) and Telecom Italia confirmed plans to proceed with an $82 billion marriage which, if approved by U.S. and European regulators and shareholders would create the biggest telecoms company in the world in terms of market capitalization.
The deal was clinched only after the German government, which owns a 74 percent stake in Deutsche, assured Telecom Italia it would not interfere in the new company.
Shares of Deutsche Telekom, the most actively traded stock in Frankfurt, slipped 2.16 percent as investors reacted tepidly to the merger. Telecom Italia also ended the day down slightly.
Software maker SAP (FSAP) ended up 10 euros at 328.00 euros in Frankfurt, a day after encouraging earnings that prompted a near one-fifth jump in the stock price.
British supermarket shares ended higher amid speculation that U.S. retail giant Wal-Mart could emerge as a counter-bidder for U.K. Asda (ASSD), which just announced merger plans with Kingfisher (KGF). Asda climbed 2.5 percent, while Kingfisher added 5.12 percent.
Telecom stocks also posted strong performances as the Deutsche-Telecom Italia tie-up prompted speculation of further consolidation. Britain's Cable & Wireless (CW) added 5 percent, while Vodafone (VOD) jumped 5.3 percent.
The SMI benefited from strong results from banking heavyweight UBS, which reported a 21 percent rise in first-quarter net profit. The shares soared more than 4 percent close at 509 Swiss francs.
Dutch electronics giant Philips finished up 4.5 percent at 83.40 euros Thursday after the company said it had substantially trimmed its losses in the first quarter from a year earlier.
It was an active day for two big mobile phone rivals. Shares of Swedish telecom equipment maker Ericsson fell 4.5 crowns to 207.5 after the company reported a halving of pre-tax profits in the first quarter from the year-ago period, to 1.3 billion crowns. The earnings slump had been expected following an earlier profit warning. Ericsson also said job cuts would be larger than the 10,000 figure initially announced.
Finland's Nokia, by contrast surged on news that its pre-tax profits soared 96 percent to 758 million euros. Mobile sales leapt 92 percent. But the company also warned that full-year operating margins are likely to fall short of the 23.9 percent first quarter level. Nokia added 2.75 to 73.00.
In Paris, France Telecom (PFTE) surrendered early gains to end down 0.8 percent. Computer services provider Cap Gemini (PCAP) closed 3.85 percent higher, while STMicroelectronics (PSGS) raced up 5.08 percent.
|
|
|
|
|
 |
|
