Europe Higher on Ceasefire

Ivaylo
14 Aug, 2006
Frankfurt

European shares gained ground on Monday, after oil prices plunged in electronic trade and mergers-and-acquisition speculation once more reemerged as a market theme.The U.K. FTSE 100 index added 0.6%, the German DAX Xetra 30 index rose 0.8% and the French CAC-40 index increased 0.8%.

[R]7:00AM European markets rose on oil price slump.[/R]
European markets were higher on Monday.The U.K. FTSE 100 index added 0.6% at 5,854, the German DAX Xetra 30 index rose 0.8% at 5,675 and the French CAC-40 index increased 0.8% at 5,027. Oil also was lower as BP said on Friday that it will pump 200,000 barrels of oil a day from the Prudhoe Bay field in Alaska during repairs; BP had initially said it would shut the entire 400,000 barrels a day field.

Airlines that are sensitive to oil prices rose. British Airways rose 1% and Lufthansa added 1.3%. German construction and infrastructure group Hochtief rose 2.2% after it said that its second-quarter profit rose 37% to 58.5 million euros ($74.6 billion) and sales rose 6% to 3.7 billion euros. Citigroup cut mobile-phone operator Vodafone Group to hold from buy, saying the company is worth over 150 pence a share if it executes well but that the market needs confidence that environmental factors won''t overwhelm management''s efforts.

Oil prices dropped nearly a dollar Monday as traders expected the upcoming Mideast cease-fire and responded to the positive news that BP would be able to maintain half of its production at a large oil field in the U.S. state of Alaska. Light sweet crude for September delivery fell .92 cents to $73.43 a barrel. September Brent at London''s ICE Futures exchange slipped .73 cents to trade at $74.90 a barrel.

Gold traded lower on Monday at $629.00 an ounce, down $12.60 an ounce from Friday''s close of $641.60. The euro was up against the U.S. Dollar, buying $1.2756 in early European trading, up from $1.2729 in New York late Friday. The British pound rose to $1.8928 from $1.8901.The dollar was a little higher against the Japanese currency, climbing to 116.35 yen from 116.26 yen.