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Dow cheers bourses
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February 11, 1999: 1:39 p.m. ET
No news from Greenspan on interest rates is good news for Europe
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LONDON (CNNfn) - Europe's major equity markets posted strong performances Thursday, buoyed by a robust rally in technology stocks on Wall Street and a placid appearance on Capitol Hill by Alan Greenspan, the man who holds the key to future U.S. monetary policy.
No news was definitely good news for investors as the Federal Reserve chief steered studiously clear, as expected, of interest rate policy in testimony before the House Banking Committee, and January U.S. retail sales came in on a par with forecasts.
Snapping a six-day losing streak in high style, London's FTSE index of 100 leading components surged more than 2 percent, with advancers leading decliners by a three-to-two margin amid a slew of corporate news.
Uncertainty nipped at investors in Frankfurt after talks between metal and engineering employers and members of IG Metall, Germany's largest trade union, with 2.7 million members, collapsed, paving the way for a possible strike action. IG Metall leaders are set to poll workers in a key region on the strike.
But in Frankfurt, the electronically traded Xetra Dax ended up more than 1 percent, or 55.25 points, at 4,869.29. Paris shares rose 1.76 percent on the CAC-40 to finish at 4.072.34.
Swiss shares climbed 0.11 percent to 6,898.9.
The threatened German strike action was seen as exerting pressure on industrial issues. Machinery maker MAN fell 2 euros to 238, while BMW (FBMW) gave up 7.50 to 698.50.
Deutsche Telekom (FDTE) rose 5 percent to 36.30 euros after the telecom giant said it is bidding for a majority stake in Austrian mobile communications operator Max.Mobil Telekommunikation Service. Deutsche said it wants to boost the 25-percent stake in Max.Mobil already held by its T-Mobil subsidiary.
Among the more volatile continental stocks, Dutch electronics giant Philips reversed earlier losses to end up 0.24 percent after the company posted a fourth-quarter loss on continuing operations of 679 million guilders ($349 million). Philips attributed the slump to a 6 percent drop in worldwide sales.
Sweden's Volvo, which is looking to purchase heavy truck and bus maker Scania, shot up nearly 6 percent to 223.5 crowns after saying it may use proceeds from the sale of its car division to Ford Motor Co. to but back shares if attempts to acquire another company should not pan out. Volvo also reported a 12 percent dip in net income in 1998.
Scania stock plunged 11.8 percent in Stockholm after its largest shareholder, Investor AB, dampened takeover speculation by saying it isn't seeking a buyer at present.
In London, British Telecom (BT.A) soared 10.6 percent to close at 980 pence, after its third-quarter pretax financial results came in above expectations. BT said net earnings fell to 858 million pounds ($1.40 billion) from 1.019 billion in 1997, excluding exceptional items; the results beat market forecasts of 698 to 792 million pounds.
Over in the banking sector, embattled British giant Barclays (BARC) got a welcome lift from news the bank had appointed 52-year-old American Michael O'Neill as its new chief executive. O'Neill, the first non-Briton to take the top post, said he would be scouting for opportunities to expand.
Barclays shares shot up 5.42 percent to end at 1,420 euros.
Shares of Shell Transport & Trading (SHEL) dipped more than 2 percent to 329 pence, amid a plunge in 1998 group earnings at Royal Dutch/Shell spurred by heavy write-offs and a restructuring at the beleaguered oil colossus.
Royal Dutch/Shell said net income, excluding special charges of $4.5 billion, fell 36 percent to $901 million, hit by Asia's demand-slicing economic turmoil and a slump in global oil prices. Royal Dutch shares slipped 2.53 percent in Amsterdam as the company vowed to cut costs and take other initiatives to stem the profit decline.
In the tobacco sector, a California court's decision to slap $50 million in punitive damages on Philip Morris in a smoking-related lawsuit snuffed out sentiment for British-based rival, British American Tobacco (BATS). Shares of BAT slid 4 percent in London to end at 588.1 pence.
Europe's largest retailer, Metro (FMEO), hit by profit downgrades in previous sessions in Frankfurt, shed some early gains to close down 2.30 euros at 61.60.
Deutsche Bank (FDBK) lost 0.45 euro to 47.30 the day after Germany unveiled plans to set up two funds to compensate victims of the Holocaust. The funds will be financed by banks and companies that participated in the Nazi-led seizure of assets and employed slave labor.
Software firm SAP (FSAP) climbed 3.50 euros to 318.50 following four days of declines, as the German software firm announced a strategic alliance with Electronic Data Systems of the United States that will enable SAP to market its business software to mid-sized and small enterprises.
Siemens stock (FSIE) ended up 0.70 euro at 60.40 after the semiconductor firm said it had jointly produced technology with Motorola to produce chips on 300 mm equipment at a third of the current cost per chip.
In Zurich, shares of Swiss specialty chemicals group Clariant shed 5 francs to 700 following a financial report showing a 6 percent group sales decline in 1998 to 9.34 billion Swiss francs ($6.62 billion).
But the company also said it expected annual sales growth of about two percentage points above the sector norm in its specialty markets, and predicted higher profits in 1998 and 1999.
In Paris, pay- TV giant Canal Plus (PAN) extended previous gains, leaping more than 5 percent to 284.9 euros, even as Rupert Murdoch's News Corp. denied media reports that the two companies are contemplating a deal to pool their interests to gain dominance in the European pay-TV market. 
--from staff and wire reports
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