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Zurich tops mixed Europe
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August 2, 2000: 1:30 p.m. ET
Big banks move mostly higher on bourses, but techs, telecoms tumble
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LONDON (CNNfn) - Renewed investor thirst for "old economy" banks and food companies lifted London's key index Wednesday, but Europe's markets ended mixed as telecom and technology sector losses across the region submerged blue-chip indexes in Paris and Frankfurt.
London's benchmark FTSE 100 index ended up 11.7 points, or 0.2 percent, to 6,391 with Royal Bank of Scotland (RBOS) again leading the pack with a gain of 6.4 percent - on top of a 11-percent jump a day earlier following a better-than-expected quarterly earnings report.
The SMI in Zurich was the healthiest of Europe's largest national indexes, closing up 1.6 percent to 8,151.2, ending just shy of a two-year high. Drug company Roche rose 3.7 percent and re-insurer Swiss Re added 3.4 percent.
In Paris, the CAC 40 blue-chip index trickled down 2.38 points to close at 6,529.91 with computer consulting firm Cap Gemini (PCAP) down 4.8 percent while index heavyweight France Telecom (PFTE) slumped 1.8 percent. 
Frankfurt's Xetra Dax lost 33.08 points, or 0.46 percent, to 7,112.45 after re-insurer Munich Re (FMUV) bucked overall strength for blue-chip German financials, dropping 3.8 percent.
The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, gained 0.3 percent, pulled higher by a 3.5-percent gain in its food and drug sub-index. The information technology hardware sector shed 3.1 percent as Finnish mobile-phone maker Nokia fell 3.9 percent, while its telecom sub-index declined 1.6 percent.
Wall Street moved higher as Europe's bourses closed, with the Nasdaq composite index up 1.5 percent and the Dow Jones industrial average rising 0.7 percent.
In the currency market, the euro eased slightly to 91.34 U.S. cents from 91.44 in New York late Tuesday. Economists said rising expectations of inflation pressures in Europe would moderate in coming months -- reducing the need for interest-rate hikes - should help the region's stocks and bonds in the coming months but could hurt the common currency.
Financials swing big in London
Banks were among Europe's top gainers for a second day. Alliance & Leicester (AL-) rose 5.4 percent, Barclays (BARC) added 4.7 percent ahead of Thursday's earnings release, and Royal bank of Scotland rival Bank of Scotland (BCST) added 3.6 percent.
But two London-listed financial firms headed lower following their earnings reports. Standard Chartered Bank (STAN) plunged 10.3 percent as analysts expressed surprise at the size of anticipated expenses for a cost-cutting drive that will reduce the bank's workforce by about 6,000. Standard Chartered reported 31 percent growth in underlying first-half profit. 
And insurer CGNU (CGNU) sank 6.3 percent after the company posted a smaller-than-expected first-half operating profit of £800 million ($1.2 billion) in its first financial report since the combination of insurers CGU and Norwich Union, although it also increased its estimate of cost savings to be generated by the merger.
Many defensive consumer goods and drugs stocks rose. Anglo-Dutch foods company Unilever (UNV) rose 6.1 percent and drug maker AstraZeneca (AZN) rose 3.8 percent. German drug maker Schering (FSCH) rose 1.5 percent in Frankfurt.
Telecom-related stocks fell. Networking systems specialist Bookham Technology (BHM) dropped 7 percent, mobile phone heavyweight Vodafone (VOD) slipped 3.5 percent, while network operator Energis (ENE) fell 4.3 percent.
Marconi (MNI) shed 4.5 percent after the networking equipment maker tapped a new chief executive officer for its telecom network division Fibreway ahead of a likely initial public offering for the unit. French rival Alcatel (PCGE) declined 3.6 percent.
Bucking the weakness in the sector was Paris-listed Dutch data network operator Equant (PEQU), topping CAC 40 gainers with a climb of 5.6 percent. The company recently projected a return to profit in the second half of the year after trimming losses in the second quarter. BNP Paribas upgraded the stock to "outperform" from "neutral" Wednesday.
Banks in Paris on the upswing
Shares of BNP Paribas (PBNP) itself got a lift from the rising banking tide, up 1.6 percent, while Société Générale (PGLE) rose 3.2 percent ahead of its expected earnings report Thursday.
Select old-economy stocks rose in Paris, with automaker PSA Peugeot Citroen (PUG) adding 1.7 percent and rival Renault (PRNO) rising 2.2 percent. Retailer Carrefour (PCA), often seen as a safe haven when sentiment turns sour on "new-economy" shares, rose 4.5 percent.
Leading the gainers in Frankfurt was tour operator and steel company Preussag (FRPS), climbing 4.3 percent after saying shareholders of Britain's Thomson Travel (TRV) had voted to accept its takeover offer. 
Germany's Commerzbank (CBK) added 3 percent after a report in German magazine Focus Money said Britain's HSBC Holdings (HSBA) had acquired an option to buy a 7 percent stake from Commerzbank's leading shareholder, CoBRa Holdings. CoBRa declined to comment on the report.
Also in Frankfurt, Deutsche Bank (DBK) climbed 4 percent and Dresdner Bank (DRB) gained 1.9 percent.
In the German tech sector, computer chip firm Infineon Technologies (FIFX) fell 2.7 percent and parent Siemens (FSIE), an electronics and engineering firm, fell 1.9 percent, though its electronic subsidiary Epcos (FEPC) added 1.5 percent.
Dax heavyweight Deutsche Telekom (FDTE) shed 2.2 percent. 
-- from staff and wire reports
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