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European Stocks Mostly Higher but Uneasy

FRANKFURT -- Stocks were mostly higher here, but markets were extremely edgy ahead of Wall Street's open after three days to mull last week's steep losses.

European and Asian stocks shot higher yesterday after

Fed Chairman Alan Greenspan

hinted Friday that the Fed's next rate move might be down. But the glow from Greenspan's comments has worn off, and Asia, Russia and Latin America still look as dangerous today as they did before Greenspan spoke. And how the turbulence will affect company earnings remains a major concern.

Trading across Europe was at a near standstill, despite huge gains in

S&P 500

futures. Futures were up 21.40 points at 997.40, indicating a powerful Wall Street open. But the S&P gains did little to soothe the frayed nerves of potential bargain hunters, most of whom remained glued to the sidelines. Investors here have grown accustomed to seeing overnight S&P futures gains melt into the red after Wall Street opens.

In Frankfurt, the

Xetra DAX

was up 67 points, or 1.4%, at 4991, and in Paris the


was up 64, or 1.7%, at 3759. But in London the


went against the trend, down 26 points, or 0.5%, at 5320. Today's losses, however, came after the FTSE yesterday posted its second largest point gain ever.

The dollar was a bit firmer at 132.38 yen and 1.7285 marks, while the U.S. long bond was yielding 5.29%.

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Bank shares, badly bruised in recent weeks, were winners today.

Deutsche Bank

was up 3.0%,

Banque Nationale de Paris

up 2.5% and


up 1.5%%.

In Frankfurt,

Man AG

surged 10% after the machinery and truck maker reported high-than-expected earnings.

Andreas Kehl, equities salesman at

Deutsche Bank

in Frankfurt, described the European stock market as "a very scared bull."

The psychological damage of the last few weeks has been severe, and many investors still holding long positions will use any strength in coming weeks to jump ship, he said. Everybody knows that October -- and its scary implications -- is just a few weeks away.

Despite the holiday in the U.S. yesterday, Kehl said most sellers in Germany were U.S.-based accounts. "That might mean these funds are suffering net outflows," he said.