European shares extend four-month highs

First Published:	29/09/2006 12:57:05
European stocks were higher on Friday, with Frankfurt’s Xetra Dax and London’s FTSE 100 both passing through 6,000 as auto stocks and financial groups led the way. By mid morning, the FTSE Eurofirst 300 was up 0.4 per cent to 1,403.82, extending its four-month high. The Dax was up 0.6 per cent to 6,023.10, the FTSE 100 added 0.5 per cent to 6,000.4 and the CAC 40 in Paris gained 0.6 per cent to 5,281.15. In the US overnight, all three main stock indicators ended a little higher, but caution prevailed ahead of Friday’s core personal consumption expenditure data later in the session. On Thursday, the Dow Jones Industrial Average gained 0.3 per cent to 11,718.45, hitting a six year high, but failing to reach its all time closing high. The S&P 500 gained 0.2 per cent to 1,339.15, hitting a five year high. Auto stocks performed well as the main European manufacturers were upbeat at the Paris Motor Show. Porsche added 1 per cent to €815.77 after it said it aimed to remain the most profitable carmaker. Elsewhere, Fiat added 1.7 per cent to €12.49 and BMW gained 1.3 per cent to €42.26. Shares of German truckmaker MAN continued to benefit from the likelihood that a costly bid for Swedish rival Scania will fail, and the possibility that it may enter a three way merger deal with Scania and Volkswagen’s truck unit. At the Paris Motor Show on Thursday, VW, which holds a 34 per cent voting stake in Scania, said it would not sell its shares in the company. MAN gained 1.4 per cent to €66.60, while Scania fell 0.3 per cent to SKr437.50. VW added 1.3 per cent to €68.40, buoyed also by news a restructuring agreement was struck with labour union IG Metall. Man Group, the world’s largest listed hedge fund, led financial stocks higher after the British company reported strong first-half results. Its shares gained 5.8 per cent to 469p. Spanish construction group ACS confirmed on Thursday night it had upped its holding in domestic utility Iberdrola to 10 per cent, making it the biggest shareholder in the company. ACS fell 0.5 per cent to €37.70, while Iberdrola lost 2.4 per cent to €35.64. Meanwhile, it was reported in the Spanish press that Jose Manuel Entrecanales, chairman of conglomerate Acciona, was trying to further block the takeover of Spanish power generator Endesa by Germany’s Eon, asking banking group Santander to buy shares in the company. Acciona shares gained 0.1 per cent to €120, Endesa fell 0.1 per cent to €34.08 and Eon fell 0.2 per cent to €92.49. Havas, the French advertising group, fell 6 per cent to €3.62 after it reported an unexpectedly sharp fall in first-half operating profit on disappointing revenue growth and due to the cost of hiring new staff. The company said it was “not proud” of the results, but was pursuing a “long-term” action plan which would bring it in line with its peers by 2008.
Source:  Financial Times http://news.ft.com