MARKET REPORT: Technology stocks, which had been weak on Monday, yesterday regained some of their composure. Alcatel, Nokia, Infineon and STMicroelectronics all prospered. Alcatel led the way, adding 3.2 per cent to reach €19.10, while STMicro put on 2.8 per cent to €36.80 and Philips added 1.4 per cent to €33.27.
Frankfurt DAX: 5,062.04 (-3.80); Paris CAC: 4,518.42 (+64.45)
Hopes for good results from Intel boosted sentiment and Goldman Sachs gave a further lift, raising its recommendation on the tech sector from "underweight" to "neutral". Analyst Charles Elliott said the focus would remain on higher-beta stocks such as Arm, Infineon, Nokia and videogame companies' stocks, which should rise even if the environment worsens.
Infineon added 2.5 per cent to €25.43, ahead of results next week. The consensus view is for first-quarter losses before interest and tax of €550 million. For the same period a year earlier, Infineon reported a profit of €446 million.
Siemens, which had fallen in the morning, rallied to be 0.6 per cent higher at €73.11 in late trade. Vodafone announced it had sold Siemens its stake in Atecs Mannesmann for €3.66 billion, which some analysts thought was high.
French consumer electronics group Thomson Multimedia rose 1.2 per cent to €35.53. Dresdner Kleinwort Wasserstein upgraded the stock from "reduce" to "hold" on an improved outlook. The shares have risen from a low of €18.31 on September 21st - a gain of almost 100 per cent.
Utilities gained from some rotation out of cyclicals into defensives. In Germany, RWE gained 0.7 per cent to €42.80, while Eon was up 2.3 per cent to €58.84. In France, Suez was up 5.1 per cent to €32.45 and Vivendi Environnement was up 2 per cent to €38.
Schroder Salomon Smith Barney upgraded the Spanish power utility Endesa from "neutral" to "outperform", though it cut its share price target from €22.70 to €20.70. The shares rose 2.7 per cent to €16.99. Meanwhile, Iberdrola fell 1 per cent to €13.90 on a downgrade from Lehman Brothers. - (Financial Times Service)
