|
Telecoms power up Europe
|
 |
July 2, 2001: 12:02 p.m. ET
Investors snap up cheapened telecoms stocks, which had been 'oversold'
|
LONDON (CNN) - Europe's main bourses closed higher on Monday, led by telecom stocks that had been cheapened by recent debt concerns.
"The telecom sector has been oversold in recent sessions," Michael O'Sullivan, strategist at Commerzbank, told CNN. "Vodafone and Nokia are looking oversold."
Telecom stocks have come under pressure in recent months amid concerns some operators would find it difficult to cut debt after they lavished billions of euros on high-speed mobile phone permits in Europe.
The pan-European FTSE Eurotop 300's telecom sector has fallen by a third from a peak in March 2000 at the height of the dot.com boom. The telecom sector has dropped 25 percent this year.
In London, the FTSE 100 index rose 74.2 points, or 1.3 percent, to 5,716.7 as index heavyweight and the world's biggest mobile phone operator Vodafone Group (VOD) jumped 6.7 percent.
Energis (EGS), Britain's biggest Internet data carrier, rose almost 6 percent and Telewest Communications (TWT), the U.K.'s second-largest cable TV operator, added 4.8 percent.
British Telecom (BT-A) rose 4.2 percent on reports it would close its unprofitable Concert joint venture with AT&T (T: Research, Estimates) of the U.S. BT declined to comment on the reports.
The CAC 40 in Paris advanced 71.18 points, or 1.4 percent, to 5,296.51, with index heavyweight France Telecom (PFTE), up 4.8 percent, after hitting a year-low of  50.55 last week.
Its mobile phone unit Orange (PORA) climbed 3.2 percent.
Media companies rose after a recent battering amid concerns a downturn in the ad market would pummel profits. TF1, France's biggest broadcaster, rose 2.9 percent and Vivendi Universal (PEX), Europe's biggest media company, rose 3.5 percent.
Frankfurt's late-trading Xetra Dax rose 61.99 points, or 1 percent, to 6.120.37, as Europe's biggest phone company by sales, Deutsche Telekom, (FDTE) rose 2.4 percent.
Infineon Technologies (FIFX), Europe's second-biggest chipmaker, rebounded from earlier losses, rising 2.8 percent after saying it would seek to raise up to 1.7 billion in a share sale.
In Amsterdam, the AEX index was up 1.3 percent, as Europe's No. 3 chipmaker and biggest consumer electronics company Philips Electronics gained 2.5 percent and ASM Lithography, the world's biggest supplier of chip making equipment, added 1.2 percent.
The SMI in Switzerland was last up 0.7 percent, reversing earlier losses.
Milan's MIB30 soared 2.2 percent as a hotly contested battle for Italy's No. 2 power company sent stocks in key players higher.
Italian carmaker Fiat rose 8.9 percent after saying it was leading a group of investors, including France's EdF, in bidding for conglomerate Montedison. Shares in investment bank Mediobanca, which holds a 15 percent stake in Montedison, gained 4.1 percent. Montedison dropped 7.6 percent.
The pan-European FTSE Eurotop 300 rose 1.4 percent, with the telecom sector leading the way, up more than 4.5 percent.
The auto sector made strong gains, up 2.6 percent, after provisional French new car registration figures for June showed a 20 percent month-on-month increase. French carmaker Renault (PRNO) gained 4.9 percent, the world's fifth-biggest automaker, DaimlerChrysler (FDCX), rose 2.6 percent, and German luxury automaker BMW (FBMW) added 2.2 percent.
Among other technology bellwether stocks, Finland's Nokia rose 1.6 percent and Ericsson, the world's biggest supplier of mobile phone equipment, gained 4.2 percent.
In midday trade in New York, U.S. stocks edged higher after the National Association of Purchasing Management said its index of manufacturing activity rose, topping forecasts, a signal that the world's biggest may be recovering from a slowdown in economic growth.
Still, a number of companies issued profit warnings, putting a lid on any far reaching gains. Minnesota Mining & Manufacturing (MMM: Research, Estimates) said earnings in the latest quarter could miss forecasts.
The Nasdaq composite index gained 16.84 points, or 0.8 percent, to 2,177.38. The Dow Jones industrial average gained 110.98 points, 1.1 percent, to 10,613.38.
In the currency market, the euro was weaker against the dollar, fetching 84.63 U.S. cents compared with 84.98 cents in late New York trade on Friday. 
|
|
|
|
|
 |
|
