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European stocks look beyond war
LONDON, England (CNN) -- European bourses rose midday Wednesday despite persistent concerns about the way the war in Iraq was unfolding. London's FTSE 100 added 0.6 percent to 3,785.9 and Frankfurt's electronically traded Xetra Dax climbed 0.9 percent to 2,658.38, while the CAC 40 blue chip index in Paris also advanced 0.9 percent to 2,822.13. The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 0.8 percent. "Markets have opened weakly and come good by lunchtime for the second day running,'' Roger Hornett, global strategist at Gilissen Securities, which manages five billion euros globally, told Reuters. "That shows the investment community is looking through the war and is beginning to show a real commitment to equities.'' But investors are concerned the war in Iraq could hurt global growth prospects and corporations may not deliver on promised earnings. "I feel the rally has stalled amid disappointment about progress in the war, but Bush is right, the allies will be victorious, and that will provide more fuel for the market to advance from a purely sentiment point of view rather than on fundamentals,'' S&P strategist Clive McDonnell told Reuters. Technology stocks led the charge after the tech-laden Nasdaq rose sharply on Tuesday and was projected to extend gains. Nokia, the world's biggest mobile phone maker, rose 1.9 percent to 14.16 euros, rival Ericsson added 2.5 percent to 6.20 Swedish crowns, and chipmaker Infineon (FIFX) climbed 4.3 percent to 7.28 euros. HVB Group (FHVB), Germany's second largest bank, rose 5.8 percent to 8.14 euros after Reuters said it was about to detail plans to sell some businesses to avoid asking investors for cash. British Airways (BAY), Europe's biggest airline, fell 1.6 percent to 120 pence after saying it would cut flights to the United States as demand fell. The Gulf war has hit business already suffering from a post-September 11 downturn. The AEX index in Amsterdam climbed 0.5 percent, and the MIB 30 in Milan inched up 0.6 percent but the SMI in Zurich added 0.5 percent. In the U.S. on Tuesday, stocks rallied on a technology-fueled buying spree stemming from the latest news in Iraq, but lost some gains by the close after a surprise decision by Congress to cut President George W. Bush's proposed $726 billion tax cut by half. (Full Story) The Dow Jones industrial average rose 0.8 percent, or 65.55 points, to 8280.23 and the S&P 500 index rose 1.2 percent, or 10.51 points, to 874.74, while the Nasdaq composite gained 1.5 percent, up 21.23 points, to 1391.01. Wall Street was expected to open little changed later Wednesday. S&P 500 index futures edged up 1.8 points to 874.00 on the Globex trading system, while fair value, a measure that takes account of interest costs and dividend payments, was calculated at 873.18.
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