LONDON (CNNfn) - European equity markets closed mostly ahead Wednesday, with only the blue-chip index in London holding on to strong early gains to add more than 2 percent, while Paris was up about 1 percent and Frankfurt ended narrowly ahead.
In London, the benchmark FTSE 100 index closed up 132 points, or 2.12 percent, at 6,364.80, just below its session peak. The unpopular leisure and retail stocks drove the market higher with a slew of double-digit gains in a sector that has lagged behind the overall market in recent months. Insurance stocks also made smart gains. The FTSE would have powered higher but for BP Amoco, its second-largest component, which closed narrowly down.
The Xetra Dax in Frankfurt ended at 7,711.14. The Dax was the best performer among Europe's three largest bourses in February with a gain of 10 percent.
Telecoms continued to buoy the CAC 40 in Paris, which ended up 1.06 percent at 6,256.32, as investors moved back into France Telecom ahead of its 1999 earnings due after the market closed. Crédit Lyonnais also enjoyed strong buying focus as investors targeted financial stocks considered undervalued.
Smaller markets struggled to make headway during the session and drifted into the red at one point before the advance on Wall Street helped them regain ground. The SMI in Zurich added 0.7 percent, Amsterdam's AEX was 0.66 percent higher and the Mib-30 in Milan ended up 0.6 percent after earlier rising to a record high.
The pan-European FTSE Eurotop 300, a broader gauge of the region's largest stocks, was 0.9 percent higher at 1,594.19, with its computer and utility components showing the strongest gains.
On Wall Street, the Dow Jones industrial average was 0.13 percent ahead at the close of the European markets, while the Nasdaq was back in record territory, up 1.48 percent.
In the currency markets, the euro ended at the close of European markets at about $0.9698, about 0.8 cents above its New York close Tuesday. The single currency was bolstered by a stronger-than-expected increase in the
euro-zone's purchasing managers index, a key indicator of inflation expectations. The index rose to 57.4 in January, ahead of the consensus forecast of 56.4, adding weight to expectations of a rise in euro-zone interest rates this month.
Takeover talk lifts Colt
Colt Telecom was the FTSE 100's best performer, rising 12 percent, amid continuing takeover speculation and a raised stock rating from Lehman Brothers. Cable & Wireless, touted as a possible bidder, was up more than 7 percent, as it recovered from a slump Tuesday in the wake of the planned sale of its Hong Kong unit to Internet investor Pacific Century CyberWorks. Vodafone AirTouch, which accounts for 13.9 percent of the FTSE 100, was 0.8 percent lower.
Financial stocks were mixed after their rebound Tuesday from recent lows, with insurance merger partners CGU and Norwich Union both gaining more than 5 percent.
Profit disappoints
Business services group Rentokil Initial, the worst FTSE 100 performer last year, slumped 15.5 percent after reporting a 10.3 percent rise in full-year profit and announcing a buyback of 25 percent of its shares, valued at 1.5 billion pounds ($2.37 billion). Underlying profit growth fell short of analysts' expectations.
In Frankfurt, index heavyweight Deutsche Telekom rose 3 percent, buoyed by a slew of analysts' upgrades and reports of a possible link with Spain's Telefonica.
In Paris, technology consultant Cap Gemini advanced 2.8 percent, in the wake of its agreement Tuesday to acquire the consulting unit of accounting firm Ernst & Young.
France Telecom rose 4.2 percent before publishing 1999 earnings - due out after the market closes Wednesday. Bouygues, which controls the country's second-largest cellular operator, gained 5.4 percent. 
|
