Sun, Jun 04, 2006 - Page 10 News List

European stocks mixed as NYSE deal sparks flurry

AFP , LONDON

European stocks closed mixed on Friday, giving up earlier gains after a weak start to trading on Wall Street dampened momentum, traders said.

In London, the FTSE 100 index gained 0.26 percent to close at 5,764.60, in Paris the CAC 40 rose 0.25 percent to 4,959.70 while in Frankfurt the DAX fell 0.36 percent to 5,687.04.

The DJ Euro STOXX 50 index of leading eurozone shares fell 0.31 percent to 3,636.89 points.

Earlier on Friday, European stocks had recovered some of their recent losses as investors seized on news that the New York Stock Exchange Group was to acquire the pan-European stock market Euronext.

The US$10 billion cash and stock deal, announced overnight in New York, will create the first trans-Atlantic securities market -- to be named NYSE Euronext -- and placed pressure on rival exchanges to consolidate, dealers said.

But Wall Street shares faltered in opening deals as traders digested the implications of a weaker-than-expected report on the US labor market for economic growth and interest rates.

In Paris trading, NYSE Group's decision to acquire Euronext sent the share price of its European rival rocketing to 71.15 euros, an increase of 3.27 percent from the close on Thursday.

"NYSE Group reached a definitive agreement to merge with Euronext, lifting the shares of the pan-European bourse operator," analysts at the Sucden brokerage said.

The 214-year-old NYSE trumped a competing bid by Deutsche Boerse, the German operator of the Frankfurt stock exchange, to acquire Paris-based Euronext, which operates bourses in Paris, Amsterdam, Brussels and Lisbon.

In Frankfurt trading, Deutsche Boerse shares fell 1.15 percent to 105.30 euros.

The NYSE's move also ups the ante for rival exchanges -- chiefly the NASDAQ and Deutsche Boerse -- to assemble their own deals to avoid being left behind in global consolidation.

Elsewhere in Europe, in Brussels the BEL 20 closed up 0.18 percent at 3,678.83 points, in Madrid the IBEX 35 gained 0.13 percent to 11,340.7, in Amsterdam the AEX fell 0.61 percent to 438.90 points and in Milan the SP/MIB lost 0.17 percent to 36,529 points.

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