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London leaps, BP Amoco gushes
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February 16, 2000: 1:02 p.m. ET
Bourses close mostly higher, led by energy, chemical shares; techs slump
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LONDON (CNNfn) - London's blue chip gauge rebounded from a near four-month low Wednesday, closing more than 2 percent higher amid a surge in economically sensitive energy giant BP Amoco on the back of strong commodity prices. Zurich and Frankfurt posted modest gains, while Paris, the regional killjoy, lost ground as profit-taking engulfed a heavyweight blue chip involved in a major Internet deal.
Mining, food, utility and chemical stocks underpinned solid gains across the region that tempered worries over U.S. interest rates. The European Stoxx energy index advanced 5 percent, with oil prices floating around the $30 mark in New York. That was just shy of Tuesday's nine-year highs.
Benchmark Brent crude was quoted at $27.13 a barrel late Wednesday in London, unchanged from its Tuesday close.
Early weakness on Wall Street, where the Dow Jones industrials opened higher before slipping into the red, kept investors cautious as Europe awaited rate clues from Greenspan's semi-annual testimony Thursday on monetary policy and the U.S. economy before the U.S. Congress.
Europe's largest stock gauge, the benchmark FTSE 100 in London closed up 142.2 points, or 2.4 percent, at 6,147.4, brushing off early weakness. The gauge was helped by an almost 8 percent surge in BP Amoco prompted in part by strength in crude oil prices. On Tuesday, the FTSE fell to its lowest level since Oct. 21. The Dow Jones was off about a quarter percent when European markets closed.
In Paris, the CAC 40 closed down 0.76 percent at 6,046.27, a loss of 46.36 points, after a volatile session punctuated by news of a major Internet alliance involving German heavyweight Deutsche Telekom and conglomerate Lagardère. The index briefly dipped below the 6,000 level Wednesday as consolidation pressures built. The electronically traded Xetra Dax finished up 1.3 percent at 7,490.32, pulled higher by utility and chemical stocks, while the SMI in Zurich shot up 1.9 percent to 6,933.3, helped by healthy gains in drug giant Novartis and food company Nestle.
Among smaller markets, the AEX in Amsterdam gained 1.3 percent, while the blue-chip Mib-30 in Milan jumped 1.6 percent.
The pan-European FTSE Eurotop 300, a broader gauge that offers a snapshot of the regional mood, ended 1.4 percent higher at 1,543.48, helped by advances of 4 percent or more in its food, steel, restaurant, oil and gas, mining, life insurance and beverage segments. These more than offset losses in the information technology sector (0.8 percent), electronics (0.7 percent), and telecom industry (0.4 percent).
In London, Europe's leading oil producer BP Amoco (BP-A), which carries the second-biggest weighting on the FTSE 100 index, rocketed 7.9 percent, to 512 pence, while rival Shell Transport & Trading (SHEL) advanced 6.3 percent to 478 pence.
The banking and financial sector was also strong, contributing about 39 points to the FTSE 100 advance. Barclays (BARC) barreled up 7.1 percent to 1,470 pence, amid positive reaction to Tuesday's results. HSBC Holdings (HSBA) gained 6.4 percent following strong gains in its Hong Kong-traded stock, which climbed 5 percent. Prudential (PRU) rallied 10.7 percent.
In the media sector, United News & Media (UNWS) leapt more than 9 percent, matched in percentage terms by Carlton Communications (CCM). Hilton Group surged 12.8 percent, heading the FTSE gainers list for the second day in a row, amid continued positive reaction to moves to offer online betting.
Cadbury Schweppes (CBRY), a soft drinks and candy maker, gained 5.8 percent after reporting a 55 percent rise in 1999 net profit.
On the downside, British Telecommunications (BT) lost 3.8 percent after a British government minister said he may move forward the date at which the firm must open up its "local-loop" business to rival phone carriers.
Drug maker Glaxo Wellcome (GLXO) tumbled 3.25 percent, and SmithKline Beecham (SB) gave up 2.1 percent on their final separate earnings reports before their planned $153 billion merger. Glaxo said net income last year dropped slightly to 1.81 billion pounds ($2.93 billion), while SmithKline, the smaller partner in the merger, posted a 13 percent rise in 1999 net profit to 1.42 billion pounds.
Among chemical shares rising in Frankfurt, Degussa Huels (FDGS) was up 3.4 percent, Bayer (FBAY) rose 3.3 percent and BASF (FBAS) charged up 7.3 percent. Germany's Chemical Industry Association said Wednesday chemical sales inched up to 188 billion marks ($94.24 billion) last year, from 187.4 billion marks in 1998.
Deutsche Telekom (FDTE) ended up 1.2 percent, after the company's online unit agreed on a share swap to acquire Club Internet, a Web access service, from France's Lagardère. Telekom shares traded at 86.5 euros. Lagardère (PMMB) shares slumped 5.8 percent to 90.55 euros, although they earlier hit a new high of 108 euros.
Utility shares also firmed, with Veba (FVIA) gaining 3.4 percent and its merger partner Viag (FVIA) up 4.3 percent. Veba shareholders on Monday approved the combination of the two companies.
In France, Lagardère's agreement to sell its Internet access unit in return for a 6.5 percent share in Deutsche Telekom's T-Online ended up providing little, if any, inspiration for media and technology stocks in Paris, which were sharply lower. Pay-TV operator Canal Plus (PCAN) tumbled 6.2 percent, reversing an earlier gain of nearly 3 percent. Conglomerate Vivendi (PEX) slipped 1.3 percent, chipmaker STMicroelectronics (PSTM) gave up 6.7 percent and computer services consultant Cap Gemini (PCAP) lost 3.3 percent. France Telecom (PFTE) fell 2 percent amid fears of the impact the Lagardere-Deutsche Telekom alliance may have on its business. Automaker Peugeot (PUG) rose 1 percent amid continued speculation it is poised for a deal with DaimlerChrysler (FDCX). 
--from staff and wire reports
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