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Bourses head lower
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May 21, 1999: 6:00 a.m. ET
European bourses weaken on lack of impetus from Asia or Wall Street
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LONDON (CNNfn) - Bourses headed lower in morning trading Friday as investors took their cue from a mixed session in Asia overnight and a downbeat end to trading on Wall Street Thursday.
Renewed anxiety over the likely boosting of U.S. interest rates, a weak outlook for the euro-zone economies and a report of a rift between the two strongest NATO allies, the United States and United Kingdom, over Kosovo, all played a part in dampening sentiment.
The U.K.'s FTSE 100 gave up its initial gains to trade 13 points down at 6,355.4, a drop of 0.2 percent. Trading was expected to be volatile ahead of the expiration of May index options.
In Frankfurt, the Xetra Dax fell further into the red, as blue chips gave up 23 points to 5,219.89, or almost 0.5 percent.
Selling pressures mounted on Paris stocks. The CAC 40 was off 37 points at 4,384.62, a fall of 0.8 percent.
Zurich also racked up losses, with the SMI down 33 points at 7,075.9, a fall of 0.47 percent.
European bourses were mindful of Wall Street's low-key close, where the Dow Jones Industrial average ended Thursday almost 21 points lower at 10,866.74.
Early indications are for a flat open on Wall Street later Friday, with the S&P futures index traded on the Globex system almost unchanged at 1,343.50. Traders in London calculated fair value for the S&P 500 futures at 1,342.71.
Attention in Europe is focused on Milan, where the takeover battle for Telecom Italia is coming to a head. Olivetti and Telecom Italia shares were both just over 1 percent higher as the deadline for the former's $65 billion hostile takeover bid approached.
The Italian stock exchange said Olivetti had received acceptances from almost 20 percent of Italia's shareholders at the close Thursday. This is well short of the minimum 35 percent stake the former typewriter maker said it would need to deem the bid successful, but most institutions were expected to declare their hands Friday
In London, losses were spread fairly evenly across the index with food and beverage giant Cadbury Schweppes (CBRY) down 1.77 percent on a report that German competition authorities were set to block the planned $1.85 billion takeover of the company's non-U.S. beverage operations by Coca Cola (KO).
Telecom group Cable & Wireless (CW.) was off 0.43 percent after it announced it would raise 3.8 billion pounds ($6.1 billion) through a securitized financing on its 50 percent interest in cellular phone company One2One.
Bucking the trend was tobacco group British American Tobacco (BATS) which was up 3.74 percent at 569 pence and security to telecom group Securicor (SCR), which was up almost 5 percent.
Insurer Legal & General (LGEN) was up 3.25 percent on renewed speculation that a takeover bid was imminent.
The main factor weighing on the Swiss index was pharmaceutical group Roche, which was suffering from Thursday's record fine by U.S. competition authorities. Roche shares were down 1.5 percent at 16,745 Swiss francs.
German rival BASF (FBAS), which with Roche, was accused of operating a cartel to fix the prices of vitamins, showed few side-effects. Its shares were 0.5 percent down in Frankfurt. The two companies were fined a total of $725 million.
German banking group Commerzbank (FCBK) fell almost 2 percent to 29.60 euros, after reporting a 4 percent slide in first-quarter net income.
In Paris, Renault (PRNO) stock was down almost 2 percent after its new Japanese partner, Nissan, unveiled its sixth group loss in seven years earlier Friday.
French tech stocks were also under pressure with STMicroelectronics (PSGS) down over 3.5 percent and Schneider (PSU) off over 2 percent.
The strongest gainer in Paris was defense group Thomson-CSF (PHO), which was up almost 5 percent.
-- from staff and wire reports
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