|
Europe makes solid gains
|
 |
September 26, 2001: 2:26 p.m. ET
Oil stocks rise as OPEC meets on quotas, investors snap up cheapened stocks
|
LONDON (CNN) - European markets rose on Wednesday, with investors snapping up stock cheapened by the rout that followed U.S. terror attacks.
London's FTSE 100 was little changed at 4,664.9 and the CAC 40 blue chip index in Paris rose 1.4 percent to reach 3,970.37, while Frankfurt's electronically traded Xetra Dax climbed 2.7 percent to 4,118.34.
"The markets are trying to find a floor," Henk Potts, markets strategist at Barclays Stockbrokers, told CNN. "They are trying to factor in all the ramifications of the terror attacks in the United States. Maybe now is the time to feed money into the market. They're close to the bottom."
German travel group Preussag (FPRS) along with the airline sector that had been battered in the wake of the terror attacks made substantial gains. Preussag soared 9.9 percent and Lufthansa (FLHA), Europe's second-largest airline, rose 6.2 percent in Frankfurt.
But British Airways (BAY), Europe's biggest airline, fell 7 percent in London.
"We are still very cautious on leisure and airline stocks," Potts said. "For British Airways the transatlantic route represents about 40 percent of revenue, they still have more room to fall but Lufthansa has made good progress in cutting costs."
Oils stocks rose as OPEC, the Organization of the Petroleum Exporting Countries, began talks to decide on whether to cut production amid concerns such a move could damage an already fragile world economy.
Brent Crude futures for November delivery fell 22 cents to $22.11 in midday London trade. Shell Transport & Trading (SHEL), which owns 40 percent of the world's second largest publicly traded oil company Royal Dutch/Shell, rose 1 percent. BP (BP-), the third-largest oil company, rose 3.2 percent, France's Total Fina Elf (TPF) climbed 4.5 percent and Italy's ENI added 2.6 percent.
"OPEC is expected to announce it will not cut production," Potts said. "We believe they have an agreement with America that it will help the U.S. economy to recover. We are buyers of Shell and BP. They have strong visibility," Potts added, referring to the companies solid earnings profile.
German drugs company Bayer (FBAY) rose 4.4 percent after pharmacists in New York said they had sold a greater-than-normal amount of the company's antibiotics for treating anthrax, amid rising fear of biological warfare after the attacks on the World Trade Center and the Pentagon.
Among technology stocks, German electronics and engineering giant Siemens (FSIE) rose 6.7 percent after its chip unit Infineon Technologies (FIFX) reassured investors it had enough cash to maintain operations despite a steep sector downturn.
Other chip and related stocks were weaker after U.S. semiconductor maker Advanced Micro Devices (AMD: Research, Estimates) said on Tuesday it plannned to close two of its manufacturing plants and cut roughly 2,300 jobs, as it continued to struggle with slack demand and increased price competition from market leader Intel.
STMicroelectronics (PSTM), Europe's biggest chip maker, fell 1 percent and world's biggest supplier of chip making equipment AMSL dropped 2.5 percent in Amsterdam.
In Amsterdam the AEX index rose 1.7 percent and the SMI in Zurich was 2.5 percent higher, while Milan's MIB30 index gained 2.1 percent.
The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 1.6 percent, with the computer services, chemicals and oil sectors in positive territory.
In the U.S. on Wednesday, stocks edged up nervously amid concerns about weaker-than-expected economic data and imminent military action in Afghanistan. Consumer confidence in September tumbled to 97.6 from August's revised 114, according to a Conference Board survey reflecting research from both before and after the Sept. 11 terrorist attacks. It was the largest drop in the indicator since 1990.
The Nasdaq composite index inched up 0.1 percent to 1,501.64, while the Dow Jones industrial average gained 56.11 points, or 0.6 percent, to 8,659.97.
Wall Street was expected to open higher later on Wednesday. S&P 500 index futures rose 2.5 points to 1,020.7 on the Globex trading system, while fair value, a measure that takes account of interest costs and dividend payments, was calculated at 1,017.3. 
|
|
|
|
|
 |
|
