Europe's first major initial public offering of the year got off to a good start as Deutsche Borse, the German stock exchange operator, made its market debut in Frankfurt.
The shares jumped to a high of €375.25 before edging back to trade at €372, a premium of 11 per cent to the issue price, in late trade. Volume was heavy with more than 1.1 million shares changing hands.
The IPO has generated €1.2 billion for the bourse's war chest as it builds up for the next round of stock market consolidation. The offer was 23 times subscribed, with particularly strong demand seen from foreign investors.
On a busy day for the German banking sector, HypoVereinsbank gained 4.8 per cent to €66 on news it planned to bundle its property financing operations into one unit. Analysts who welcomed the move said it would lift earnings at the bank and increase its return on equity.
Deutsche Bank eased 0.5 per cent to €96.21 after its chief executive said five leading insurers and financial institutions, domestic and foreign, in addition to insurer Allianz, were interested in a tie-up.
Commerzbank gave up 2.8 per cent to €30.42 as investors registered disappointment with news of a €98 million post-tax loss for the fourth quarter of 2000.
Germany's fourth largest bank posted a pre-tax profit of €2.3 billion for the full year, but said its weak fourth-quarter performance was the result of risk provisions, financial market weakness and losses due to its exposure to the Korean Exchange Bank.
GBL, the Belgian holding company, soared 11.2 per cent to €274 in heavy trade after a share swap deal which gave it a 25 per cent stake in the German media giant Bertelsmann.
Saint Gobain came off 2.5 per cent at €170.6 as concern about the glass maker's margins resurfaced following a broadly negative note from Schroder Salomon Smith Barney. The broker's price range target is €160 to €170.
Technology, media and telecoms shares lost ground following continuing declines on the Nasdaq and nervousness ahead of an earnings statement from Cisco Systems due tonight.
