FRANKFURT -- Stocks bounced after yesterday's Brazil-induced selloff, with brave investors taking advantage of the huge markdown in share prices.
Brazil's devaluation of the real rattled nerves, but did not diminish the huge amounts of liquidity sloshing around Europe. And with yesterday's plunge bringing indices across Europe down to levels seen at the start of the new year, the temptation to buy at lower prices is too great for many investors to resist.
Nick Stevenson, head European equities strategist at
in London, said he would currently avoid names with Latin America exposure. But he would not fight against the general market, which is being kept afloat by low rates. "There is an ocean of liquidity," he said.
The big winners today were telecoms. After yesterday's breather, investors were again chasing the highflying sector even higher. Banks, which were huge losers yesterday, were today clawing higher.
In Frankfurt, the
was up 23 points, or 0.5%, at 5005; in London the
was up 77, or 1.3%, at 5927; and in Paris the
was up 55, or 1.4%, at 4014.
Despite the gains, indices appeared wobbly and the general mood today remained cautious. The upside was capped by concern that Brazil's worries are far from over, and that its problems could spread to other emerging markets.
futures were lending moral support, up 7.50 points at 1246.50. Euro markets also took heart from Tokyo's winning session. Although most Asian markets fell, the
ended up 2.5%.
The dollar gained against the yen to 114.03, but was slightly weaker at 1.1638 euros. U.S. long bond prices were down slightly, yielding 5.15%.
One of the biggest movers today had nothing to do with Brazil. U.K. clothing retailer
Marks and Spencer
fell 11.5% after issuing a profit warning.
But more important to the overall mood in London was the resumption of the telecom rally.
jumped 4.6% to 10.87 stlg.
BT Alex. Brown
issued a glowing report on Vodafone, setting a price target of 15.00 stlg and saying the firm would likely win in the battle to acquire
Also in London,
Cable and Wireless
was up 2.1%,
up 5.1%, and
was up 3.1% on reports that
was in talks to acquire the Swedish auto maker.
was up 4.2%,
Banque Nationale de Paris
up 2.6% and