LONDON -- Telecom stocks drove European markets higher as investors celebrated the fact the Italian auction for third-generation mobile phone licenses ended with bids worth a total of only $10 billion, compared with the expected $25 billion.
, whose consortium
caused the premature end of the auction by pulling out after only two days, was the undoubted star of the session by closing higher 81p, or 11.5%, at 788 ($11.43). Investors are clearly relieved that BT has not piled on more debt in an effort to secure a foothold in Italy -- an arguably mature market that has already been sewn up by
Telecom Italia Mobile
But can fundamental factors alone account for the astounding performance? "After failing to maintain the break of the 700p support level on BT, we now expect a bounce out to 900p, which is key to get more excited overall," argues
technical analyst Nicola Merrell.
Vodafone was laughing all the way to the bank. The world's largest mobile-phone operator picked up its Italian license at a snip and investors rejoiced by sending the shares 4p higher, or 1.4%, to 285.
Enthusiasm spread to telecom companies that hadn't even participated in the auction.
closed up 295p, or 14.9%, at
rose 64p, or 13.1%, to 554.
closed the day an impressive 123 higher, or 1.9%, to 6438 and strength on the other side of the Atlantic, where the both the Dow Jones Industrial Average and the Nasdaq are higher, bodes well for Wednesday.
Tech stocks rose, with the
closing up 115 points, or 3%, at 3,541.
rocketed a massive 11.8% to
27.95, but the only apparent news was that
had reiterated its strong-buy recommendation.
In the media sector,
rose 81p, or 6.4%, to
13.53 after announcing that it has formed an online foreign exchange venture with
Europe's other stock markets finished Tuesday higher, as the
in Paris ended up 141.4, or 2.3%, at 6323.7 and the
in Frankfurt was up 176.6, or 2.7%, at 6797.5 late in German trading. The Neuer Markt's tech-heavy
index was up 158.2, or 3.5%, at 4758.7.
Telecom stocks continued to surge a day after the end of the Italian UMTS auction, with
ending up 8.10 euros, or 7.2%, to 121.10 ($101.15),
closing 1.19 euros higher, or 5.5%, at 22.69, and
rising 3.55 euros, or 9%, to 43.05.
The positive sentiment spilled over into technology shares, as
rose 19.35 euros, or 8.9%, to 51.21,
rose 2.00 euros, or 2%, to 90.50, and
climbed 2.33 euros, or 4.8%, to 51.21.
Old Economy shares were left behind, as
fell 0.67 euros, or 1.2%, to 53.30 and
dropped 0.20 euros, or 0.1%, to 173.80.