Europe ends mixed

May 28, 2001
Web posted at: 1555 GMT

LONDON (CNN) -- Europe's major bourses ended mixed on Monday in thin trading due to holidays in the U.K. and United States.

In Paris, the CAC 40 blue chip index rose 0.4 percent to close at 5,606.32, with defensive stocks in favor. Retailer Casino (PCO) and power equipment maker Alstom (PALS) rose by 4.3 and 3.7 percent respectively.

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Frankfurt's electronically traded Xetra Dax was down 0.3 percent in late trading to 6,205.42. Commerzbank (FCBK) was down 3.7 percent after going ex-dividend while Deutsche Telekom (FDTE) fell 1.8 per cent on very light volumes ahead of its annual meeting on Tuesday.

The European Central Bank President Wim Duisenberg explained to a European Parliament committee on Monday that the ECB was not hitting its target of 2 percent inflation, in part due to the foot and mouth crisis and rising oil prices. The weakness of the euro against the dollar was also of concern.

He reiterated the ECB's governing council now no longer saw a future inflation risk from growth in money supply while slower than expected economic growth should also "dampen upward pressure on consumer prices."

"On the basis of the information available, the current stance of monetary policy is appropriate to ensure that the euro area will be able to maintain price stability over the medium term," Duisenberg said.

In the currency market, there was no apparent effect on the euro from his remarks, but it was still slightly weaker against the U.S. dollar, fetching 86.02 cents from 86.12 cents in late New York trading on Friday.

The London Stock Exchange, Europe's biggest bourse, was closed for the Whit Monday bank holiday while Wall Street was also shut for the Memorial Day holiday.

In Amsterdam the AEX index climbed 0.8 percent, helped by a rise of 2.6 percent in electronics group Philips' shares. The SMI in Zurich was 0.1 percent higher. Milan's MIB30 index gained 0.6 percent.

The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 0.1 percent, with the forestry and paper sub-index rising by just over 2 percent.

In the U.S. on Friday, stock markets declined amid concerns that the economic slowdown will take a bigger-than-expected bite out of corporate profits.

The Nasdaq composite index fell 1.4 percent to 2,251.03, while the Dow Jones industrial average dropped 117.05 points, or more than 1 percent, to 11,005.37.

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In the telecoms sector, mobile phone operator Orange (PORA) fell 2.1 percent after a report in the Sunday Telegraph newspaper said it is in talks that could lead to the £6 billion acquisition of Germany's No. 3 wireless operator E-Plus. Orange later denied the report.

Dutch firm KPN Telecom, which owns E-Plus with U.S. carrier BellSouth (BLS: Research, Estimates), rose 1.2 percent.

France's Alcatel (PCGE) ended down 0.5 percent after The Wall Street Journal said it may announce the acquisition of Lucent Technologies  (LU: Research, Estimates) on Wednesday in an all-share $32 billion deal.

In Frankfurt, DaimlerChrysler (FDCX) fell 1.2 percent after saying its U.S. unit Chrysler was recalling 515,000 Neon cars to fix a faulty brake hose.

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