Sun, Jul 20, 2003 - Page 10 News List

European stocks decline for the week, led by Nokia

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Chip stocks

Ericsson, the world's largest maker of wireless networks, surged 1.35 euros, or 15 percent, to 10.1 yesterday. The shares are still 80 percent below their record set in March 2000.

Infineon Technologies AG has led European semiconductor stocks higher this week. Industry leader Intel Corp on Tuesday said second-quarter profit doubled and sales this period may rise more than analysts' forecasts.

Infineon, whose main product is computer-memory chips, has jumped 11 percent to 11.11 euros since last Friday. ASML Holding NV, the world's biggest maker of machines used to etch circuits onto chips, gained 3.2 percent. ARM Holdings Plc, whose chip designs are used in about 70 percent of the world's mobile phones, added 4.2 percent.

STMicroelectronics NV, which makes chips for mobile phones, added 0.8 percent. The company pared gains for the week after the forecast from Nokia, ST's biggest customer.

Cutting forecasts

The response of analysts to results released in July has been to ratchet back forecasts, according to JCF International in London. Analysts predict this year's profit at Stoxx 600 companies will rise 24.9 percent on average, according a July 17 survey by JCF.

That's less than the 25.5 percent forecast at the end of last month.

Clariden is reducing the proportion of shares it holds to 15 percent from 20 percent this month, said executive vice-president Fabrice Vallat. Clariden is a unit of Credit Suisse Group, Switzerland's No. 2 bank.

Alstom SA, the French company whose power stations generate a fifth of the world's electricity, shed 2.5 percent today to 2.71 euros, for a loss this week of 6.2 percent. Orders declined 29 percent to 4.04 billion euros in the three months ended June 30 as utilities held off spending on equipment. Sales dropped 18 percent to 4.34 billion euros.

The Stoxx 600 insurance index was the biggest gaining industry group this week, adding 3.3 percent. Mark Cathcart, an analyst at Deutsche Bank, on Wednesday advised investors to sell shares of banks and buy insurers.

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