|
Insurers lift bourses
|
 |
September 3, 1999: 5:53 a.m. ET
Europe supported by talk of $17B financial deal; but U.S. jobs watch continues
|
LONDON (CNNfn) - Talk of further tie-ups in the financial sector fed a modest run-up in European stocks Friday morning, although gains were capped by festering worries over U.S. interest rates ahead of the U.S. jobs data.
London's FTSE 100 stood just 24.4 points higher at 6220.0, a gain of 0.4 percent, lifted by the prospect of a $17 billion deal in the financial sector. But enthusiasm was tempered as traders hedged their bets ahead of August non-farm payrolls, unemployment and average hourly earnings data due later in the day.
Paris made slightly stronger gains, with the CAC 40 up 22.17 points, or 0.5 percent, at 4,572.77.
Germany's Xetra Dax was up about 22 points at 5,212.00, a rise of 0.43 percent. Zurich's SMI index nearly doubled its light early gains to trade 27.3 points higher at 7,042.2, a rise of 0.4 percent.
The pan-European Eurotop 300 index, a useful gauge of the overall mood across the region, was up 0.4 percent at 1,289.86, with life insurers rising 2.5 percent and water stocks climbing 1.65 percent.
Insurers led the charge in London, helping to brighten the mood across Europe amid news of a possible $17 billion merger in the U.K. financial services sector. National Westminster Bank (NWB) confirmed Friday it was in talks to buy insurer Legal & General (LG).
Legal & General stock shot up 5.07 percent to 202 pence after gaining more than 10 percent Thursday. Natwest slipped nearly 5 percent to 1,151 pence as investors worried about the price the bank was planning to pay.
The announcement heightened expectations for further financial consolidation around the continent. U.K. insurer Norwich Union (NU) vaulted almost 8 percent as investors bet that Natwest's rival, Barclays (BARC) was lining up a bid. Another U.K. insurer, CGU (CGU) jumped more than 4 percent.
In Frankfurt, Commerzbank (FCBK) built on early gains to stand 3.5 percent higher amid further speculation that it was in talks with rivals to set up a pan-European banking group. Dresdner Bank (FDRB) was up nearly 1 percent at 43.20 euros while Deutsche Bank (FDBK) added 0.3 percent to 63.30 euros.
European investors also drew support from the U.S. futures market, after a negative session on Wall Street Thursday.
U.S. stocks looked set for a slightly higher open Friday, with S&P 500 futures quoted 0.90 points higher on the Globex trading system at 1,321.10. London brokers estimated fair value, which takes into account the effect of dividend payments and interest costs, at 1,320.97. Trading volume is likely to be thin, however, ahead of the long Labor Day weekend in the United States.
Wall Street suffered a steep sell-off Thursday as strong economic data heightened fears that a further interest rate hike is imminent. The Dow Jones industrial average closed at 10,843.21 with a loss of 95 points. The Nasdaq composite fell almost 17 points to 2,734.24, while the S&P 500 index declined 12 to 1,319.11.
The downturn was in part due to speculation that the jobs report would show stronger-than-expected growth.
In Paris, auto stocks underpinned Friday's gains. Peugeot (PUG) was up 1.95 percent, while Renault (PRNO) advanced 1.62 percent to 53.35 after earlier hitting a new year-high of 55 euros after posting robust first-half earnings.
--from staff and wire reports
|
|
|
|
|
 |
|
