European bourses turned in an impressive rally, lifting the FTSE Eurobloc 100 by 2 per cent to 1,060.93 in the wake of another early surge for Wall Street. The FTSE Eurotop 100 index rose 2.4 per cent to 2,913.70 and the FTSE Eurotop 300 index added 2.1 per cent at 1,272.42.
Frankfurt turned in the strongest performance among leading bourses, rallying 140.63 or 2.7 per cent to 5,296.91 on the Xetra Dax index. Telecoms shares topped the activity charts. Mannesmann slipped on news of plans to bid for Orange, Britain's number three operator while Deutsche Telekom bounced strongly as some investors switched into the sector leader.
Talk of an all equity-led purchase price should talks with Orange's effective owner Hutchison Whampoa of Hong Kong lead to a successful take-over bid left Mannesmann down 15 cents at €154.60 after touching a low for the session of €148. Deutsche Telekom, jumped €2.07 or 5.1 per cent to €42.40.
Insurers tracked the better trend for markets with Allianz gaining €8.01 to €279.51 and Munich Re €11.80 at €213.30. DaimlerChrysler rose €2.47 to €69.19 and software leader SAP gained €12.60 at €407.99 ahead of today's third quarter figures.
Paris shares closed up more than 2 per cent, with winners leading losers in the CAC-40 by 30-7. Alcatel, the electronics group, led the pack after news of a substantial deal to supply internet equipment to SBC Communications caused its shares to leap almost 6 per cent higher.
France Telecom was another big gainer as investors continued to applaud its acquisition of E-Plus, Germany's largest mobile phone group.
Amsterdam rebounded in line with the broad trend across Europe, adding 9.28 to 538.41 on the AEX index. Royal Dutch and Philips were in demand. The former rose 96 cents to €53.72. Philips, responding to the upward drive for US tech stocks and helped by hopes of solid third quarter results tomorrow, gained €2.75 to €89.60. Software group Baan jumped 83 cents or 6.8 per cent to €13.13.
KPN found itself caught up in the telecoms excitement generated by the latest round of high-pressure cellular deals. The shares gained €2.19 or 5 per cent to €45.70. Heavily sold in recent sessions, media stocks reflected selected buying. Wolters Kluwer rallied 65 cents at €29.05 and Elsevier 33 cents at €9.37.
Madrid shares closed a shade over one per cent higher, led by strong gains for banks on news of the potential merger between BBV and Argentaria. Shares in BBV, which had been due to report results on Thursday, and Argentaria were suspended after they asked the Bank of Spain for authorisation to merge.
