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Europe ends mixed
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June 7, 2001: 12:09 p.m. ET
Shares lack direction as ECB leaves rates unchanged, Wall St. opens quiet
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LONDON (CNN) - European shares lacked direction on Thursday as major bourses ended mixed with no change in interest rates and a quiet Wall Street start.
The European Central Bank announced at lunchtime that interest rates would remain on hold at 4.5 percent, a decision that had been widely expected.
The euro was gaining against the US dollar – at 85 cents, up from 84.65 -- on the currency market after the announcement, but the British pound was under pressure as voters in the UK went to the polls.
It had hit a 15-year low against the dollar and a three-week low against the pound overnight on fears that a landslide Labour victory would lead to an early referendum on British entry into the eurozone. Its low had been below $1.38 but it was trading at $1.39 later on Thursday.
London's FTSE 100 ended 0.7 percent higher at 5,940.8 with market heavyweight Vodafone (VOD) boosting the index with a rise of 3.1 percent as investors considered it oversold in recent days.
In Paris, the CAC 40 blue chip index closed down 0.8 percent at 5,453.39. Tech stocks were hit by worries about U.S. earnings, with chipmaker Intel due to present its outlook after markets closed .
Alcatel (PCGE), Europe's fourth-largest telecom equipment maker, fell 4.1 percent after selling its Internet access modem business to Thomson Multimedia (PHO) for $389 million in shares. Thomson slipped 1 percent.
Frankfurt's electronically traded Xetra Dax was little changed in late trading, slipping just 0.2 percent to 6,177.87. Chemicals and drugs group Bayer AG (FBAY) was top of the leaderboard, up 3 percent, on relief that it was not likely to bid for the drugs unit of DuPont. Financial stocks were a drag on the index after a bleak profit outlook from U.S. investment bank J.P. Morgan Chase (JPM: Research, Estimates). Insurer Allianz (FALV) fell 1.9 percent.
In Amsterdam, the AEX index was 0.2 percent down, while the SMI in Zurich was 0.1 percent higher and Milan's MIB30 index rose 0.6 percent.
The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was off 0.2 percent, with the tobacco and support services sectors off 2.2 and 4.9 percent respectively.
British American Tobacco (BATS) fell 3.2 percent after rival Philip Morris (MO: Research, Estimates) was ordered by a U.S. jury to pay more than $3 billion to a lung cancer sufferer.
In the U.S., the Dow Jones industrial average was little changed by mid-morning, down 0.3 percent on reaction to the tobacco case, at 11,035.82. But the Nasdaq composite index was 0.7 percent higher at 2,232.06 as the depressed semiconductor sector rose on a trade association predicting a second-half rebound.
Looking back, things still seemed gloomy in London for chip designer Arm Holdings (ARM). It dropped 6.6 percent after it said unit shipments – which have a knock-on effect on its royalties earnings – fell 20 percent in the first quarter.
The world's biggest smart card maker, France's Gemplus, lost 7.6 percent after it warned reduced demand for its mobile phone SIM cards would mean a second-quarter loss.
Reuters (RTR), the biggest news and data provider, lost 2.2 percent. The company said it would reorganize its business and cut jobs.
Hays (HAS), a UK support services group, was the worst performer on the FTSE, plunging 31 percent after issuing a profit warning and blaming economic slowdown in a number of markets.
French automaker PSA Peugeot-Citroen (PUG) slipped 3.1 percent after tyre maker Michelin (PML) sold 1.27 million shares in the carmaker for  330 per share. Michelin gained 0.2 percent.
One of the biggest gainers in London was Railtrack (RTK),rebounding 5.7 percent after the Financial Times said institutional investors would welcome the state taking a stake in the owner of Britain's train lines. 
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