|
Bourses hit by Fed nerves
|
 |
July 22, 1999: 1:21 p.m. ET
German blue chips lead downturn; corporate activity eases London loss
|
LONDON (CNNfn) - German blue chips led European bourses in closing lower Thursday on jitters about the then-pending Congressional testimony of U.S. Federal Reserve chairman Alan Greenspan.
London, the only major exchange still open as Greenspan spoke, took a knock from some of his initial comments about excessive stock valuation. But a flurry of corporate activity pulled buyers back near the close, with the FTSE 100 finishing down 32 points, or 0.51 percent, at 6,297.8.
Germany's Xetra Dax was the biggest decliner of the four main European bourses, tumbling 73 points, or 1.35 percent, to 5,340.91.
In Zurich, the SMI stopped just short of a 1 percent fall to close down 67 points at 6,949.7. The CAC 40 in Paris suffered least to close just 12 points lower, or 0.26 percent, at 4,489.57, as hectic corporate activity in the media sector helped give the market some support.
The euro continued to firm against the dollar as it hovered around $1.05, after hitting a high of $1.545 in European trading. Data for the 11-member states showed inflation fell in June.
The biggest corporate deal of the day saw French conglomerate Vivendi (PEX) stir up more talk of consolidation in the European media sector, as it closed two deals worth $2.6 billion.
In a double swoop it increased its holdings in both Canal+ (PAN) and BSkyB (BSY), two of Europe's leading TV broadcasters. Vivendi shares rose 2.3 percent, Canal+ surged 6.6 percent, while BSkyB was almost 1 percent higher.
As part of the deal to increase its holding in BSkyB, which is 40 percent-controlled by Rupert Murdoch's News Corp., it paid U.K. media companies Granada (GAA) and Pearson (PSON) 600 pence per share for their minority stakes. Granada's shares were the best performers in the FTSE, up 7.7 percent, while Pearson was just 0.6 percent higher.
Not far behind Granada was was Imperial Chemical Industries (ICI), whose shares soared 7.65 percent as investors applauded a 5 percent increase in second-quarter profit before interest, tax and one-time items, to 197 million pounds. ICI also announced 600 job cuts.
Boots (BOOT), the drug retailer, was also strong Thursday after a positive report on its sales and outlook. Shares rose almost 5.3 percent.
The biggest blue chip loser of the session in London was the software publisher Misys (MSY), which dived almost 10 percent. It accompanied a report of a 39 percent rise in annual profits with a warning that growth would slow after 2000, as millennium bug work dries up.
Non-FTSE 100 stock Coca-Cola Beverages (CCB), the London-based bottler for Coca-Cola in Central and Eastern Europe, plunged more than 8 percent after European Commission inspectors staged a two-day series of raids on Coca-Cola offices in Germany, Austria and Denmark.
In Frankfurt, the biggest gainer was household chemicals maker Henkel [FSE:FHEN3] after it forecast a significant rise in profits this year. The stock closed 3.7 percent higher.
German banks endured another weak session. Dredner Bank (FDRB) led the way, closing almost 2 percent lower. Hypovereinsbank was not far behind, after a heavy sell-off in the previous session. The stock closed down 1.6 percent as a ratings downgrade by Goldman Sachs continued to weigh on sentiment.
But the biggest decliner in Frankfurt was luxury car maker BMW (FBMW), which plunged more than 5.2 percent ahead of half year results due next Tuesday.
German electronics and industrial giant Siemens (FSIE) closed barely changed after it reported a 17 percent rise in nine-month profit to 2.09 billion marks ($1.12 billion). The results were in line with expectations.
In the French banking sector, the three-way takeover battle heated up. French insurer Axa confirmed Thursday it planned to tender its shares in Paribas (PPF) and Société Générale (PGLE) to Banque Nationale de Paris, the hostile suitor for both banks. SocGen fell 3.6 percent, Paribas finished 3.3 percent lower and BNP closed down 2.6 percent.
In Amsterdam, electronics maker Philips took a real pasting after earnings results showed a 28 percent drop in net profit from ordinary operations, to 274 million euros. The numbers were broadly in line with analyst expectations, but the shares still fell 7.6 percent to 92.05 euros.
High-flying Finnish mobile phone maker Nokia fell back to earth, despite reporting earnings up 61 percent. The stock closed down 3.5 percent at 85.65 euros.
Amsterdam and Helsinki exchanges were also scrutinizing a tie-up between two European packaging companies who finally confirmed a $1 billion merger almost three months after announcing they were in talks. Finland's Huhtamaki closed up 1.5 percent at 34 euros, after bidding 29.04 euros cash for each share of Dutch rival Van Leer. The Dutch company's shares soared 5.6 percent to 28.30 euros.
-- from staff and wire reports
|
|
|
|
|
 |
|
