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Europe mixed on war jitters
LONDON, England (CNN) -- European stocks were mixed, in choppy midday trading on Thursday, as the United States began bombing Iraq. An early rally fizzled out after Iraq fired missiles at Kuwait City. U.S. President George W. Bush announced early on Thursday that military action to disarm Iraq had begun after missiles were fired at Baghdad. (Full story) "We're seeing some whipsawing markets here. Markets dipped briefly as investors sought safe-havens in bonds out of equities when Iraq launched missiles on Kuwait," David Brown, equities strategist at Bear Stearns, told Reuters. London's FTSE 100 was little changed at 3,768.9 and Frankfurt's electronically traded Xetra Dax inched up 0.3 percent to 2,624.47, while the CAC 40 blue chip index in Paris climbed 0.25 percent to 2,844.99. The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 0.2 percent. The Eurotop has rallied over the last five sessions amid hopes the war would be over quickly. But some analysts do not believe the gains are justified as the uncertainty of war, poor corporate earnings and economic data persist. "There will be some relief that the uncertainty is over after the launch of war but prices are likely to be held hostage to the strategic developments in Iraq,'' said Freddie Tulloch of IG Index in London. "It looks as if the U.S.-led effort to kill Saddam Hussein may have failed, which could disappoint some investors hoping for a very brief engagement,'' he said. In corporate news, Allianz (FALZ), Europe's third-largest insurer, dived 7.5 percent to 59.93 euros after saying it would raise more than $5 billion as it posted pretax loss of 935 million euros. (Full story) Reinsurer Munich Re (FMU2) fell 3.8 percent to 70.00 euros after Allianz said it planned to cut its stake in the company. British medical devices company Smith & Nephew (SN) dipped 2.2 percent to 373 pence after agreeing to buy Swiss-based Centerpulse for £1.5 billion to create the world's third biggest orthopaedics company. Centerpulse declined 2.2 percent. In the U.S. on Wednesday, blue-chip stocks rose for the sixth straight session as U.S. troops advanced on Iraq. The Dow Jones industrial average rose 0.9 percent, or 71.22 points, to 8265.45, the S&P 500 index also gained 0.9 percent, or 7.57 points, to 874.02, while the Nasdaq composite dipped 0.3 percent, or 3.48 points, to 1397.07. Wall Street was expected to open little changed later on Thursday. S&P 500 index futures gained 0.3 points to 873.00 on the Globex trading system, while fair value, a measure that takes account of interest costs and dividend payments, was calculated at 872.55.
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