Europe Gains on Telecoms

Ivaylo
14 Nov, 2001
New York City

European shares traded higher on Tuesday, helped by some further gains in the telecom sector after Vodafone Group reported well-received results, and as mining shares recouped some of the losses on the previous day. Overnight in New York, the main stock indicators finished with modest gains, driven by technology stocks. By mid morning, the FTSE 100 in London added 0.3%, Frankfurt Xetra Dax gained 0.1%, and the CAC 40 in Paris was marginally higher.

[R]6:30AM European stocks advanced supported by telecom companies.[/R]
European markets were higher on Tuesday. By mid morning, the FTSE 100 in London added 0.3% 6,210.7, Frankfurt Xetra Dax gained 0.1% to 6,397.55, and the CAC 40 in Paris was marginally higher at 5,490.4.

Advancers

UK mobile group Vodafone kept its full-year guidance of 5 - 6.5% organic revenue growth after reporting a forecast-beating rise in first-half core earnings. Vodafone gained 2%.

Telefonica, the Spanish telecoms group, gained 0.7% after reporting a better-than-expected 43% rise in nine-month operating revenue.

Telekom Austria rose 2.1% after defying expectations of a profit decline. The company reported a 1% rise in third-quarter core profits thanks to growth in its international assets, including Bulgaria’s Mobiltel.

Other telecoms groups were feeling the wave of optimism in the sector, with TeliaSonera, the Nordic region’s biggest operator, up 1.4%. It received a number of broker upgrades after reporting its own set of strong results earlier in the month. Telenor, which also reported earlier this month, gained 1.5%. Telecom Italia added 1%.

Miners such as Rio Tinto and BHP Billiton also rose more than 1% after selling off sharply the previous day amid weaker metal prices.

Decliners

Sacyr Vallehermoso, which gained a massive 15 % in the previous session following record quarterly results, gave back 3.2% as profits were taken.

Italian bank Banca Lombarda e Piemontese slipped 3.6% after it said late on Monday that it will merge with Banche Popolari Unite in a deal that will create the sixth largest bank in Italy.

Oil and gold

Crude oil for December delivery on the New York Mercantile Exchange was 0.5% higher in London. The December Brent crude contract traded on London ICE Futures Exchange at $59.45 a barrel, up 40 cents.

Gold for immediate delivery fell $1.80, or 0.3%, to $623.90 an ounce in London. Prices dropped 1.5% in the previous two sessions.

Currencies

The euro was up slightly against the U.S. dollar Tuesday ahead of a key forecast on German economic sentiment and lower-than-expected inflation. The euro bought $1.2829, up from $1.2810 late Monday in New York. Among other currencies, the British pound fell to $1.8987 from $1.9013 while the dollar was down slightly to purchase 117.85 Japanese yen from 118.12 yen.

[R]5:00AM Gold and silver futures declined on firm dollar and profit-taking.[/R]
December gold settled down $4.30 at $625.80 a troy ounce on the NYME. December silver ended 23 cents lower at $12.885 an ounce. January platinum dipped near a weekly low of $1,182 an ounce but later settled at $1,203.90, down $5.70 on the day. December palladium closed $3.95 lower on the day at $326.75 an ounce. At settlement, December copper shed 1.35 cents to finish at $3.075 per pound.

December crude oil settled down $1.01 to $58.58 a barrel. December heating oil lost 3.66 cents to close at $1.6600 a gallon and December gasoline slipped 2.57 cents to to settle at $1.5370 a gallon. December natural gas settled up 10.0 cents at $7.894 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures lost 0.70 cent at $1.1515 per pound, while the March futures fell 0.60 cent to $1.1945. Futures on raw sugar in foreign ports for March ended 0.18 cent lower at 11.67 cents a pound, while May finished down 0.13 cent at 11.81.