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European stocks gain ground
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October 23, 2001: 2:39 p.m. ET
Techs and telecoms rally to push bourses higher at close.
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NEW YORK (CNNmoney) - Europe's major indexes ended higher Tuesday, lead by jumps in tech and telecom shares, on continued news of third-quarter earnings and a morning rally on Wall Street.
"Markets are more confident that the central banks and G7 governments are determined to underwrite a recovery for next year. As the shockwaves of last month's events subside markets are backing that with a bit more confidence," said Andrew Bell, European equity strategist at Carr Sheppards Crosthwaite.
In London, the FTSE 100 closed up 2.42 percent at 5,193.3, and the CAC 40 blue chip index in Paris ended up 2.64 percent at 4,455.76, while Frankfurt's electronically traded Xetra Dax added 70 points to close at 4,690.65.
Market volume approached 2.3 billion shares while FTSE 100 gainers outstripped losers four to one as the index put together a two-day winning streak worth more than 175 points.
British Airways (BA) was the top blue chip gainer, up 14 percent, as investors anticipated fresh consolidation moves in the industry.
BA said it is talking to Dutch carrier KLM and other airlines amid expected consolidation of the European airline industry.
Among the banks, Abbey National (ANL.L) and Barclays (BARC.L) both moved higher, helped by a reassuring statement that there had been no significant deterioration in credit quality in the third quarter.
The telecoms sector was boosted by a surge in Vodafone (VOD). French rival Orange (PORA) said it expects to beat market forecasts for key parts of its 2001 results.
Its mobile phone unit, Orange, which also posts its sales Thursday, jumped 7 percent, boosted by management saying its sales would best analysts' consensus forecasts.
Dassault Systemes (PDSY) and France Telecom (PFTE) led rallying techs and telecoms as investors looked past bad news to focus on both sectors' brightening prospects -- pushing Paris to its highest close for six weeks.
The stock jumped 14.32 percent after it reduced its fourth-quarter sales forecast by less than the market had feared.
Telecoms equipment company Alcatel (ALA) gained 2.47 percent, in line with European peers.
France Telecom, due to report its quarterly sales Thursday, leaped 9.37 percent.
Lending further momentum to rising telecoms was news the French government plans to launch a second round of bidding for UMTS licences in the second half of December and that there would be at least two new bidders.
In the U.S. markets, stocks turned mixed at midday, retreating from solid morning gains, as weakness in the telecom sector and new concern about anthrax clouded the markets.
At 12:20 p.m. ET, the Dow Jones Industrials were down 26.50 to 9,350.53; they were up as much as 62 points earlier in the session. The Nasdaq composite index was up 11.33 at 1,719.41 after being more than 31 points higher. The Standard & Poor's 500 index slid 0.73 to 1,089.17. 
-- from staff and wire reports
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