European Closing Update: Markets Helped on the Way by Telecoms

Vodafone comeback makes up half of rise in Footise.
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LONDON -- The half day in the U.S. clearly left the London markets without any clear direction.

Although the

FTSE 100

ended up 157.7 points, or 2.5%, at 6,470.4, half of that rise came by courtesy of a 26p, or 9.7%, gain to 293 ($4.45) in

Vodafone AirTouch

(VOD) - Get Report

. There were no secrets behind the gain: this stock has been battered down from its high of just under 400p and was due a bounce.

Total volume in London was naturally compromised by the pre-holiday situation, leaving individual stocks to make most of the running.

We have already mentioned the effect that Vodafone had on the Footsie index, but other telecom constituents were also strong contributors to the rise.

British Telecom

(BTY)

shrugged off recent criticism by the U.K. regulator and jumped 46p, or 5.4%, to 900, and

Colt Telecom

(COLTY)

registered a gain of 200p, or 9.1%, to

24.00.

Financial stocks, however, did not fare so well. There is always a bit of uncertainty ahead of any

Bank of England

Monetary Policy Committee meeting, there being one this week, although most analysts expect rates to be left unchanged. However, there are no prizes for being a hero and getting it wrong, and with discretion remaining the better part of valor, a certain amount of switching out of financial stocks left

Royal Bank of Scotland

down 18p, or 1.6%, at

10.88 and

Halifax

39p lower, or 6.5%, at 595.

The Techmark managed a gain of 37.0 point, of 2.5%, to 3,428.1, with

Bookham Technology

(BKHM)

rising 77p, or 2.0%, to

39.23 and

ARM Holdings

(ARMHY)

up 7p, or 1.0%, to 715.

Most of Europe's other major stock markets also closed higher, with the

CAC 40

in Paris ending up 61.9, or 1.0%, at 6,508.5. Late in the German session, the

Xetra Dax

in Frankfurt was up 47.8, or 0.7% at 6,946.0 and the Neuer Markt's tech-heavy

Nemax 50

index was up 131.6, or 2.2%, at 6,072.8.

Deutsche Telekom

(DT) - Get Report

was down 1.22 euros, or 2.0%, at 58.58, amid more reports over the weekend that the former state-controlled monopoly has initiated talks with

Sprint

(FON)

about a merger.

France Telecom

(FTE)

closed up 2.50 euros, or 1.7%, at 148.90 and

Telefonica

(TEF) - Get Report

ended 1.00 euro higher, or 4.4%, at 23.50.

Most blue-chip German tech shares were up, with

Epcos

(EPC) - Get Report

climbing 8.26 euros, or 7.9%, in a technical correction to 112.75 ($107.31) and

SAP

(SAP) - Get Report

up 2.25 euros, or 1.2%, at 195.95.

Siemens

(SMWAY)

was up 3.62 euros, or 2.3%, at 161.62, however, its subsidiary

Infineon

(IFX)

was down 4.85 euros, or 5.9%, at 77.70, after Siemens issued a 2-billion euro convertible bond for its stock.

Retail giant

Metro

climbed 2.61 euros, or 7.1%, to 39.60 amid reports the U.K.'s

Tesco

was considering a bid for the company's Real hypermarket chain.

Commerzbank

fell 0.94 euros, or 2.5%, to 36.60 and

Dresdner Bank

(DRSDY)

dropped 0.99 euros, or 2.3%, to 42.11, amid a lack of news over progress towards a merger.