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Europe mostly higher
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August 1, 2001: 12:07 p.m. ET
A vote of confidence in tech shares helps bourses, but Frankfurt drifts
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LONDON (CNN) - Most European markets rose Wednesday as renewed investor confidence in chip and electronics stocks pepped up some recently neglected shares.
In London the FTSE 100 inched up 0.3 percent to close at 5,546.9, while the blue chip CAC 40 index in Paris rose 0.5 percent to 5,112.48, with high-tech shares featuring heavily among the gainers in both markets.
But Frankfurt's Xetra Dax was the exception to the sunny mood, shedding 0.4 percent to 5,837.43 in late trading, hit by weak showings from two of its most heavily weighted stocks, Deutsche Telekom and Deutsche Bank.
French chipmaker STMicroelectronics (PSTM) climbed 6 percent and the UK's Spirent (SPT), a maker of telecom testing equipment, rose 6.2 percent, the leaders on their respective national indexes, after a bullish report on the chip sector by analysts at Merrill Lynch. The report tagged STMicroelectronics a "buy".
The positive tone extended to other French technology companies. Alcatel (PCGE), a maker of telecom equipment, gained 3.5 percent, consultant Cap Gemini Ernst & Young (PCAP) closed up 4.1 percent and consumer electronics group Thomson Multimedia (PTMM) climbed 2.9 percent.
In the London tech sector, chip designer ARM Holdings (ARM) gained 3.5 percent, consultant Logica (LOG) rose 3.8 percent and software developer Sage Group (SGE) added 4.3 percent.
United Business Media (UBM), with interests from professional publishing to market research, added 4 percent after UBS Warburg issued a report rating the stock a "buy". BOC (BOC), a maker of industrial gases, rose 4.4 percent ahead of its earnings report, due next week.
Retail conglomerate Kingfisher (KGF) missed out on the London market's rally, shedding 4.5 percent as it published final details of its plan to spin off the UK Woolworths chain, the last remaining part of its general merchandising business. Giving Woolworths its independence will leave Kingfisher with home-improvement and electrical retailing interests in Britain and France, but the shares dropped amid concerns about likely cuts in the company's future dividends.
Sharp declines for two of Germany's most widely held shares overshadowed trading on the Frankfurt market.
Deutsche Telekom (FDTE), Europe's biggest telephone operator, retreated 3.7 percent a day after it revealed it would postpone an offering of shares in its mobile-phone unit, raising concerns about the outlook for reducing its debts.
The Financial Times reported Wednesday that the German company might be interested in taking a stake in Italian counterpart Telecom Italia, where a partnership featuring tyre maker Pirelli and the Benetton family took control at the weekend. Pirelli was up 2.7 percent in Milan.
And Deutsche Bank (FDBK), Europe's biggest bank, fell 3 percent after reporting first-half profit fell 35 percent as costs grew and economic slowdown hit business.
CEO Rolf Breuer reignited bid speculation by saying he didn't rule out a partial or complete takeover of Commerzbank (FCBK), one of Deutsche's smaller rivals, or another bank. Commerzbank shares gained 1.5 percent.
The woes of the two German heavyweights more than offset gains among the country's high-tech stocks, which rose in step with their counterparts across the region. Electronic component maker Epcos (FEPC) climbed 4.2 percent, chipmaker Infineon Technologies (FIFX) rose 2.5 percent and software maker SAP (FSAP) was up 1.5 percent.
Other European markets mostly rose. The SMI in Zurich climbed 1 percent to 6,916.4, Amsterdam's AEX added 0.6 percent to close at 551.83, and the MIB 30 in Milan gained 0.4 to reach 36,873.
The broader FTSE Eurotop 300, a gauge of the region's largest stocks, rose 0.2 percent, with shares in the computer services, electricals and electronics sectors among the gainers.
U.S. markets opened in a positive mood, underpinning advances on most European bourses. With buyers returning to technology stocks, the tech-heavy Nasdaq composite index rose 34.02, or more than 1 percent, to 2,061.15 in the first hour of trading, while the Dow Jones industrial average gained 25.26 to 10,548.07. 
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