A powerful rally for retailer Metro helped Frankfurt to a positive finish in the face of mid-morning weakness on Wall Street. A media report that a number of big shareholders in Metro were sounding out US retailing giant Wal-Mart as a potential buyer sent Metro shares spinning up to €47.45 amid an outburst of takeover speculation. Metro was quick to deny the story, but the group's statement did little to dampen enthusiasm. The stock closed €7.9 or 3.25 per cent higher at €44.49.
Mannesmann was also a firm feature, responding to the prospect of an increased takeover offer from Vodafone AirTouch with a rise of €8.01 to €276.01. Financials gained little comfort from the no change signal on interest rates from the European Central Bank. Deutsche Bank shed 65 cents at €84.15 and Commerzbank 85 cents at €36.
Paris bounced back from two days of losses to close 1 per cent up, boosted by a strong rally in the technology and media sectors. Media company Lagardere continued its strong run following its alliance with Canal Plus and its plans to sell part of its Internet unit. It gained €9.20 to €83. Canal Plus rose €18.50 to €159.50. STMicroelectronics rose €9.90 to €163 after its fourth-quarter earnings topped expectations.
Amsterdam ended little changed with broad weakness offset by strong runs for a number of individual stocks. The AEX index finished up 2.20 at 644.79. ASM Lithography shot ahead by 13.8 per cent after turning in better-than-expected results. The shares gained €16.90 to €139.50 with 5.1 million traded. ASM got a boost from Lehman Brothers, which included the stock in its 10 best European picks. Philips, up €5.40 at €154.50, telecoms leader KPN and brewer Heineken were also on the Lehman list. KPN added €1.90 at €87.85 and Heineken €1.39 at €50.76.
Zurich was lower with interest rate worries exacerbated by the national bank's announcement it was targeting a higher Libor rate within its defined range. The SMI index slid 85.6 to 7,251,2.
Stockholm gained support from the technology sector, particularly telecoms company Ericsson, which has earnings results due next week. Ericsson, the market's most heavily traded stock, closed eight Sewdish krone higher at SKr569 (€66.47). The general index gained 24.17 to 5,499.59.
