FRANKFURT -- Euro bourses marched cautiously higher today, armed with oceans of liquidity and an improving technical outlook.
Many previously wishy-washy traders are now starting to tilt toward the bullish camp. They took heart today in Wall Street's ability Tuesday to hold most of Monday's explosive gains and on
continued dollar strength against the euro, which is good for European exporters.
In London, the
hit a new intraday record high, last up 80, or 1.3%, to 6235. The previous intraday high was 6195 on Jan. 8, while the closing high was 6179 on July 20 last year.
Nick Glydon, a technical analyst at
Robert Fleming Securities
in London, was bearish last week but is now starting to go with the flow. "It looks like a big chart breakout," he said. "It looks like Europe could be leading the way higher for Wall Street."
Nonetheless, Glydon said some traders here will not feel comfortable staking big fresh bets unless the cash
index this week can make a clean break above key resistance of 1280. "That would send a strong buy signal," he said.
In Frankfurt, the
was up 52 to 5064, while the
was up 46 to 4254 in Paris. Both indexes were still off record highs -- the Dax was way off its 6224 record -- but were at important resistance points.
Among the biggest winners were
, which climbed 3.3%;
, up 3.7%;
, up 2.5%; and
, which gained 3.5%.
The mood in Europe was buoyant enough that even a couple of big-time profit disappointments failed to knock the broad market off balance.
plunged 10.7% immediately after the German auto maker warned that 1999 would be difficult because of a slowing global economy. But in an optimistic market like today's, the lower prices attracted plenty of buyers and VW cut losses, last down 3.1%.
And in London,
slid 8.9% immediately after announcing that its second-half profits were down 32% on Asia problems, which it conceded will continue in the first-half of this year. But guess what? You got it. Bargain hunters swooped to the rescue, and Standard Chartered cut losses and was last down 1.9%.
The dollar was little changed from New York's close, at $1.1024 against the euro and at 121.43 yen.
Markets thus far today were paying little attention to higher yields in the wake of Tuesday's cautious talk from
Amin Nasr, managing director at
in Frankfurt, agrees that the Dax is testing important resistance and that an upside breakout is possible. "We are at a very important point right now," he said. And if the Dax would break higher, he would be a big buyer.
But he remains worried about the possibility of higher rates and what Greenspan might say today in his second day of Congressional testimony. And he thinks that after a day or two, the broad market will again turn its focus to rates and the chance they will go even higher.