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Europe strides ahead
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October 22, 1999: 5:24 a.m. ET
Bourses open on upside after Wall St. pares heavy losses; telecoms loom large
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LONDON (CNNfn) - European stocks opened tentatively higher Friday after Wall Street managed to pare heavy losses in Thursday's session. But sentiment was expected to remain fragile amid continued uncertainty about the outlook for U.S. stock prices.
Telecom stocks remained in sharp focus as speculation mounted that Britain's Vodafone AirTouch (VOD) may make a play for Germany's Mannesmann (FMMW), which is buying out U.K. mobile-phone concern Orange (ORA) for $36 billion, including assumption of debt. Orange shares were up 1.24 percent, while Vodafone stock rose 1.4 percent.
After sliding more than 1 percent Thursday amid heavy initial losses on Wall Street, London's leading FTSE 100 gauge climbed 31.8 points, or 0.54 percent, shortly after the start Friday as traders expressed relief at the Dow Jones' late-hour comeback. Eyes in London were turned towards economic data due out later in the morning that could offer clues as to whether the Bank of England will hike interest rates before the end of the year.
Wall Street's blue-chip index clawed its way back from a loss of more than 200 points triggered by IBM's profit warning to close 94.67 points lower Thursday - well above the 147-point loss at the time of the London market close. The tech-laden Nasdaq eked out a narrow gain.
Paris' CAC 40 was up 0.63 percent at 4,631.45, while the electronically-traded Xetra Dax in Frankfurt advanced 0.8 percent to 5,289.54. Zurich's SMI traded at 6,822.7, a rise of 0.6 percent, while Amsterdam gained more than 1 percent.
Wall Street was indicated for a slightly higher open Friday after clawing its way back from a deep nose-dive Thursday to close less than 100 points lower. S&P 500 futures on the Globex system were off 0.90 points at 1,295.10, while fair value, which takes into account dividend payments and interest costs, was calculated at 1,293.05.
Swedish telecom company Ericsson leapt more than 8 percent in Stockholm after the world's third-largest mobile phone maker reported a 35 percent decline in nine-month profit but forecast a strong improvement in 2000 and longer-term gains from an ongoing restructuring.
In Paris, France Telecom (PFTE), which accounts for more than 12 percent of the CAC's total weighting, gained 1.2 percent despite concerns about its acquisition strategy. France's second-largest cellular telephone company, Vivendi (PEX), was up nearly I percent as the market continued to home in on cell-phone businesses.
British American Tobacco (BATS) slumped 6.25 percent in London as the tobacco company continued to suffer the aftershocks of a Florida court's ruling against U.S. cigarette giant Philip Morris Cos. in a liability suit.
--from staff and wire reports
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