European Markets Close: Trouble in the U.S. Weighs on Shares
LONDON -- It's back to the trenches.
The
FTSE 100
index closed down 65.4 points, or 1.0%, at 6,375.6 after Wall Street's fall on the
gross domestic product
and
Employment Cost Index
reports got investors wondering whether there is a danger that US stocks will head into a tail spin.
It looked at one point on Friday that bids, rumored and actual, were going to keep London out of the mire this afternoon. No such luck.
However, as is usual on a Friday afternoon, there were one or two runners and riders, and betting was fierce. Cement maker
Blue Circle
shook off its concrete boots, with a gain of 29p, or 9.3%, to 343 on a revival of bid rumors. Once again,
Hanson
or
Lafarge
were in the frame to cement a deal.
TheStreet Recommends
In the retailing sector,
William Morrison
gained 10p, or 8.3%, to 130, as the supermarket trolley did the rounds.
Marks & Spencer
traded actively, with volume at the close totaling 19.8 million shares. After a roller-coaster ride, it eventually settled 7p lower, or 2.4%, at 279. Rumored bidder
Tesco
was also heavily traded (39.6 million shares), closing a penny lower, or 0.6%, at 165.
Without doubt, the most actively traded stock of the day was
Vodafone Airtouch
(VOD) - Get Vodafone Group Plc Report
with closing volume a substantial 244 million shares. Barely a day goes by without some news or rumor about
Mannesmann
(MNNSY)
and Vodafone. This morning it was reported that Mannesmann is attempting to acquire one-third of
AOL Europe
, the
America Online
(AOL)
and
Bertelsmann's
joint venture.
Besides furthering Mannesmann's Internet ambitions, the ploy could also be a means to fend off Vodafone's hostile takeover bid, which formally expires in little over a week.
"Well, first and foremost Mannesmann is trying to stay independent, but one shouldn't under-estimate what a deal with AOL would offer, strategically speaking," said a Frankfurt-based equity strategist who rates Mannesmann a buy regardless of the outcome. Mannesmann closed down 0.8, or 0.3%, at 268.20 euros and Vodafone was finished down 2.75, or 0.8%, at 343.75 pence.
A lack of developments in the banking sector left the three main players nursing mixed fortunes.
Bank of Scotland
dipped 11p, or 2.7%, to 667,
NatWest
(NW)
fell 10p, or 0.6%, to 12.73 pounds, but
Royal Bank of Scotland
moved up 3p, or 0.5%, to 10.58 pounds, the last named underpinned by an aggressive profit forecast and support from major stakeholder
Banco Santander
(STD)
The Continental bourses ended out the week uneven, with the
Xetra Dax
in Frankfurt closing down 59.53, or 0.8%, at 7066.60 and the
CAC 40
in Paris ending the session up 42.70, or 0.8%, at 5731.05.
In Germany, both specific stocks and the broader market were prone to wild swings throughout the day, although some stayed in the red from the outset as investors took profits made earlier in the week.
Deutsche Telekom
(DT) - Get Dynatrace Inc. Report
slumped 3.6, or 4.8%, to 71.90 euros and
DaimlerChrysler
(DCX)
dropped 1.7, or 2.4%, to 68.15 euros.
Although Wall Street's pathetic open flipped some shares into negative territory, the technology standards never looked back. Both
SAP
and
Siemens
were able to close higher Friday. SAP ended up 12, or 1.4%, at 845 euros and electronics giant
Siemens
finished 1.2 higher, or 0.8%, at 151.10 euros.
