News of the Yugoslav ceasefire in Kosovo sent Frankfurt steeply ahead in the dying minutes of trading, lifting the Xetra DAX index to a close of 5,022.27, up 120.46 or 2.5 per cent.
Mannesmann, which acquired the fixed-line telecoms operations of Veba and RWE, rose €5.80 to €130 as investors warmed to the deal that increases Mannesmann's share of the German long-distance market to 15 per cent. The news also sparked gains at Veba and RWE with what was seen as orderly withdrawal from the telecoms business lifting the former €1.91 to €50.65 and RWE El.31 to €43.
Steel leader Thyssen rose to an eight-month high, adding €1.19 at €19.40. DaimlerChysler was a good market, partly catching up with the recent strong performance of the ADRs on Wall Street and responding to positive comment at Merrill Lynch. The stock gained €2.66 to €84.41.
Deutsche Bank, in negative territory for most of the session, hardened €1.05 at €49.15 in spite of joining Merrill Lynch's sell list. Earnings downgrades are expected in the short-term.
Paris rose 1.8 per cent with the CAC-40 index settling 74.63 higher to 4,304.48 after a last-minute rally was sparked by Serbia's decision to sue for peace.
Volatile STMicroelectronics led the way, adding €5.60 to €97.50, tracking overnight gains on Nasdaq. Fellow IT stock Cap Gemini retreated from intra-day highs to close up €3.50 at €156.
Oil issues were among the main gainers, boosted by weekend reports that a key Iraqi pipeline had been bombed. Total added €3.80 to €115 while Elf-Aquitaine gained €4.50 to €126. Telecom stocks were stronger. Amsterdam was well supplied with firm features, notably among financials. Aegon gained €2.10 at €35.75 while ING rose €1.10 to €51.60, benefiting from optimism about US trading, an upgrade to buy at Morgan Stanley Dean Witter and solid results from a mortgage bank offshoot. The AEX index ended up 2.71 at 536.34.
Zurich saw action in its small, hi-tech issues in a largely dull market, with SMI index rising 37.6 to 7,170.
Madrid pressed ahead as the market adopted a attitude after several weeks of lethargy. The general index finished 21.10 or 2.4 per cent higher at 87.83.
The improved mood was reflected in strong demand for some blue chips, including Telefonica which soared €2.21 or 5.6 per cent to €41.50 on the view that it had become undervalued compared with its European telecoms peer group.
