Europe holds on to gains

January 17, 2002 Posted: 1740 GMT

LONDON (CNN) -- European markets ended higher on Thursday, as technology stocks held on to early gains thanks to more upbeat earnings results from the U.S.

London's FTSE 100 edged up 0.2 percent to 5,138.4 and the CAC 40 blue chip index in Paris rose 1.1 percent to 4,475.64, while Frankfurt's electronically traded Xetra Dax was up 2.8 percent to 5,123.7 ahead of the 1900 GMT close of trading on the German exchange.

The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 1.2 percent, with the computer and financial sectors among the biggest gainers.

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Europe got some late support from Wall Street, as U.S. markets rose after General Electric, the world's biggest company based on capitalization, posted positive fourth-quarter results. That followed good results from U.S. computer giants Compaq, Apple and Yahoo!  -- countering the bad tone set earlier in the week by chipmaking giants Intel of the U.S. and Samsung of South Korean, who both announced cuts in capital spending.

The news helped boost European computer stocks, with French technology consultancy group Cap Gemini (PACP) rising 4 percent, while software maker Dassault Systems (PDSY) ended 1.8 percent higher.

Siemens (FSIE), Germany's biggest engineering and telecoms company, was up 4.4 percent in late trading after saying first-quarter operating earnings had improved "substantially" over the previous quarter. 

Its comments provided a fillip for its European rivals. Alcatel (CGEP), France's biggest phone equipment maker, closed up 0.8 percent, off its highs for the session.

Finland's Nokia, the world's biggest mobile phone company, rose 2 percent, also off its highs, with Sweden's Ericsson, the biggest supplier of third generation wireless infrastructure, also up 2 percent in Stockholm.

The top performer in London was engineering group Invensys (ISYS), recovering losses from earlier in the week to close up 4.6 percent.  

Meanwhile, Deutsche Telekom [FSE:DTEGn] was up 3.4 percent in later Frankfurt trading after the German telecoms giant reported a sharp rise in subscriber numbers at its U.S. mobile subsidiary VoiceStream.

Outside the technology sector, Commerzbank (FCBK) was up 4.2 percent in late trading, after rising more than 10 percent at one point. Shareholder Munich Re (FMUV) said on Thursday it had increased its stake in the German bank to 10.4 percent. Munich Re, Europe's biggest reinsurer, owns a 25.7 percent stake in rival bank HVB Group (FHVM), which gained 7.2 percent on speculation the banking sector could be ripe for consolidation.

French-Belgium bank Dexia (DEXI) was the top gainer in Paris, rising 4.9 percent after Bearns Stearns upgraded its stock to "attractive" from "neutral," while BNP Paribas (BNPP) was up 3.9 percent after  Commerzbank upgraded its stock to "buy" from "accumulate."  

The European Aeronautics, Defence and Space Company (EADS), which owns 80 percent of Airbus, rose 2.3 percent. Airbus, the world's second-largest passenger jet maker, said on Thursday sales rose 19 percent as it delivered a record number of aircraft.

In the auto sector, DaimlerChrylser [FSE:DCXGn] was up 2.9 percent in late Frankfurt trading, after revising its third-quarter earnings upwards on Wednesday. BMW (BMWG) was up 1.2 percent after it said on Thursday its Japanese unit expected solid sales growth in 2002.  

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Among Europe's smaller markets, Amsterdam's AEX index rose 1.5 percent and Milan's MIB30 index rose 1.3 percent, while the SMI in Zurich was also up 1.3 percent.

In the U.S. on Thursday, stocks battled to maintain some gains Thursday morning after several technology leaders posted better-than-expected quarterly results. Among them, General Electric (GE: up $1.15 to $38.82, Research, Estimates), the world's biggest company based on capitalization, said fourth-quarter profit rose 9 percent. Wall Street is now bracing for after-the-bell earnings reports from computer giants IBM and Microsoft.     

The Nasdaq composite was up 11.21 points, or 0.6 percent, to 1,955.65, while the Dow Jones industrial average rose 40.41 points, or 0.4 percent, to 9,752.68.