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Bourses lack momentum
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November 13, 1998: 12:48 p.m. ET
Possible U.S. military action provides excuse for inert European markets
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LONDON (CNNfn) - European markets ended a quiet week with a whimper Friday, as the threat of a U.S. military strike in the Persian Gulf generally kept investors idle.
Bourse activity was further dampened by the public holiday Wednesday in some markets, with some operators turning that into an extended break.
The major indexes in Asia turned in a stronger performance, but that wasn't enough for nervous European markets to post early gains.
In London the FTSE 100 inched up 14.2 points, 0.3 percent, to close at 5,463.2.
Frankfurt's Xetra DAX eased just 2 points to 4,643.8.
In Paris the CAC 40 also slipped 2 points, to 3,562.23.
Zurich's SMI was the poorest performer, dropping 0.7 percent, 49 points, to 6,703.9.
A few companies did benefit from the Gulf tension that paralyzed activity across Europe. Oil stocks enjoyed the revival in the crude price, although it remains at historically depressed levels.
Still, any good news was welcomed by investors in the oil majors. The stocks have been buffeted by poor quarterly results and news of job losses on both sides of the Atlantic.
In London Shell rose 3 percent and arch-rival BP picked up 2 percent.
Investors weren't frightened to extract a hefty punishment from companies coming out with bad news. Household goods maker Reckitt & Colman failed to cut the mustard when it warned that full-year sales would be lower. Shares fell 14 percent.
Reckitt's woes also hit consumer goods giant Unilever, which dipped 2 percent
Chemical maker ICI indicated it might be interested in the specialty chemicals unit put up for sale by the drug company Zeneca. Some analysts scoffed at the idea ICI could afford the 1.5 billion pound ($2.5 billion) price tag, however.
ICI shares rose 1 percent, while Zeneca stock was unmoved.
Takeover rumors caused a partial recovery at beleaguered cable manufacturer BICC. The shares jumped 18 percent on hopes that the conglomerate Wassall might snap up the company.
Metro, Europe's biggest retailer, caused the biggest stir in Germany. The company said late Thursday it would concentrate on cash and carry warehouses, and put large parts of its retail empire up for sale. In Frankfurt Metro shares soared 6 percent.
Chemical issues were strong as investors hunted for oversold blue chips. BASF and Bayer rose 2 percent and 3 percent respectively, and Hoechst jumped 6 percent.
The bank sector moved in the opposite direction.
In France a batch of nine-month revenue announcements gave investors something to keep an eye on.
Thomson-CSF results were in line with expectations, but hopes of industry consolidation have been driving the shares. Friday they rose 4.4 percent.
Oil stocks Elf Aquitaine and Total both jumped more than 3 percent. Elf also unveiled nine-month sales that were down by 13 percent. Lower oil prices were blamed.
The financial sector enjoyed a day of mixed fortunes. BNP and Paribas posted solid rises, but CCF and Societe Generale headed lower.
Vague talk of mergers among financial and pharmaceutical issues failed to breathe any life into a dull Swiss market. UBS, due to announce nine-month earnings Tuesday, gained a little over 1 percent.
In Scandinavia the spotlight remained on Norway's Fokus Bank. The shares fell back from earlier highs, reached after rival bidders Handelsbanken and Den Danske both offered 80 crowns per share. The Fokus board has recommended the Den Danske bid. Fokus shares ended the day at 73.5 crowns, up just 1 crown.
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