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Bourses stage afternoon rally
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November 19, 1998: 12:43 p.m. ET
European markets pick up in late trade, despite sluggish Wall Street
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LONDON (CNNfn) - Bourses blasted back in afternoon trade Thursday, posting gains around the 2 percent mark, despite a tentative beginning.
A gradual pick up in confidence helped the markets move upward, although there was little news of substance to justify the marked change in mood during the day.
Overnight news from Asia was indecisive, and Wall Street's opening hardly inspirational, but European markets seemed determined to put in a good performance
In London the FTSE 100 rose 132.2 points, 2.42 percent, to close at 5,606.2.
Frankfurt's Xetra DAX ended the day above the 4,800 barrier that some technical analysts see as significant. The index rose 105 points, 2.2 percent, to 4,805.69.
In France the CAC 40 jumped 2.6 percent, 94.26 points, to 3,706.76.
Switzerland's SMI ran up 142.9 points, 2.1 percent, to 6,993.8.
In London's blue-chip index the spotlight fell on shipping group P&O. Earnings from its cargo joint venture provided relief to investors accustomed to a string of bad news. P&O shares surged 14 percent to 668 pence, although they remain well short of the 1,000 level they reached in August.
Sinking fast was furniture retailer Storehouse. Poor half-year earnings and a warning that full-year profit will not match last year's level put the skids under the shares.
Storehouse stock tumbled 17 percent to 132 pence, dragging retailers such as Marks & Spencer into negative territory.
Dialog suffered even more. The online information provider warned on fourth-quarter revenue, and then watched its stock price almost halve to 93 pence.
Bank stocks rose sharply, led by a 7 percent jump as Barclays stock hit 1,223 pence, and a 5 percent gain to 1,530 pence at HSBC.
Telecom stocks also moved upward, led by a 6 percent gain at index heavyweight British Telecom.
The defense sector rallied, with British Aerospace rising 6 percent to 500 pence and GEC surging 5 percent to 486 pence.
In Paris, investors looked to the consumer-related stocks.
Retailers such as Carrefour, up 5 percent to 4,185 francs, and Pinault-Printemps Redoute, up 4 percent to 961 francs, led the way.
There were strong gains too for beauty-products group L'Oreal and luxury-goods supplier LVMH. Shares in both companies soared 6 percent. L'Oreal shares hit 3,387 francs and LVMH closed at 1,091.
Not to be left behind, banks such as CCF and Societe Generale also enjoyed strong runs.
Retailers Karstadt and Metro were in demand in Frankfurt, helping the stocks to 4 percent rises.
Newly-quoted DaimlerChrysler continued to benefit as investors adjusted their portfolio weightings to accommodate the new heavyweight. The stock firmed again, up more than 7 marks to 147.55 marks.
Conglomerate Viag remained in the doghouse, as investors gave their verdict on a rumored takeover of Switzerland's Alusuisse. The stock tumbled 35 marks Thursday to close at 1,025 marks.
The Swiss market temporarily breached the psychologically important 7,000 level Thursday, although it eased toward the close.
UBS and CS Group were in the vanguard. UBS rose 2 percent to 403 francs.
Pharmaceuticals giant Roche regained some ground after recent losses. The stock closed at 16,260 francs, up 390 francs.
Amsterdam's battered Baan staged a minor comeback. After a 17 percent hammering Wednesday the software group found some supporters, helping the shares to recover 7 percent to 22.7 guilders.
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