LONDON -- It was a tale of two markets this morning, back to the Old Economy stocks vs. the New Economy stocks dynamic Friday, as investors seemed to want little to do with the established names of the stock market. They were "keeping their powder dry" waiting for the U.S.

producer price index number for June. The

FTSE 100

was up 7.4 point midmorning to 6483.1, while the

Techmark

index of leading technology shares rose 20.7 points to 3471.8.

The morning's headliners were techs, media and telecoms.

Colt Telecom

(COLT)

continued to climb and was 54p higher to

23.55 ($35.39), while

British Telecom

(BTY)

added 5p to 895.

Best of the bunch in the media sector was

Pearson

, which gained 8p to

20.59. However, what the sector was really waiting for was news of the regulator's decision whether to allow a merger between

Carlton Communications

, down 4p to 822, and

United News & Media

, up 2.5p to 900.5, or a possible spoiler bid from

Granada Media

, up 3/4 p to 572.

Among the techs,

Kewill Systems

was the subject of vague takeover rumors, rising 55p to 755.

Baltimore Technologies

(BALTV)

moved up 30p to 592, while

Psion

gained 20p to 730. However,

Bookham Technology

(BKHM)

encountered further profit-taking in the wake of its recent strong run, dipping 94p to

44.55.

Glaxo Wellcome

(GLX)

slid 66p to

18.45 and merger partner

Smithkline Beecham

(SBH) - Get Report

fell 31p to 838 amid increasing concern that controls on drug prices in the U.S. could be implemented.

AstraZeneca

(AZN) - Get Report

took a 42p hit to

30.40.

Europe's other stock markets were in positive territory early Friday, although things remained quiet with Paris closed in observance of Bastille Day. The

Xetra Dax

in Frankfurt was up 139.2 to 7335.2 and the

Neuer Markt's

tech-heavy

Nemax 50

index was up 111.8 to 6077.7.

Bank stocks were some of the day's biggest movers, following a report from

Dresdner Bank

and

Commerzbank

were considering a massive pan-European merger with

Banco Santander Central Hispano

(STD)

,

BNP Paribas

and

Credit Suisse

. Dresdner was up 2.00 euros to 44.60 ($41.79), Commerzbank was 1.40 euros higher to 38.55, BSCH gained 0.09 euro to 11.24 and Credit Suisse fell 2.50 francs to 211.00 ($127.57). German financial issues were also benefiting from the passage of a major tax reform package by the upper house of parliament.

Major German tech companies were also in positive territory, as

Siemens

rose 2.70 euros to 182.70,

Epcos

(EPC) - Get Report

was up 5.70 euros to 121.70 and

Infineon

(IFX)

gained 4.29 euros at 84.69.

Deutsche Telekom

(DT) - Get Report

rose 1.55 euros to 60.90 and

Telefonica

(TEF) - Get Report

was up 0.04 euro to 25.10.