Frankfurt see-saws and ends marginally higher

European markets gained ground for the fifth day running, ending a volatile session with the FTSE Eurobloc 100 index 0.7 per cent better at 1,078.80. Upward momentum was not quite so punchy among the broader indices, however. The FTSE Eurotop 100 index added 0.2 per cent at 2,960.40 while the FTSE Eurotop 300 index could only manage a 0.1 per cent gain to 1,292.33.

Frankfurt had a see-saw session, rallying as investors sighted the latest US inflation data but running into renewed selling towards the close. The benchmark Xetra DAX index, which hit a best-of-session 5,301.49, ended just 2.81 better at 5,259.91.

Munich Re was a strong performer in an otherwise lacklustre financial sector, adding €6.45 at €186.95. Deutsche Bank came off €1.19 at €63.65.

Among utilities, RWE gained €1.02 to €38.50 and Viag added €5.00 at €490.

Engineering conglomerate Linde ran into widespread disapproval of its take-over of Swedish gas group Aga. The shares, downgraded by Morgan Stanley Dean Witter and SG Securities, shed a further €2.55 at €59.

Chemicals were dull following unexpectedly weak profits from the Swiss Ciba group. BASF came off 55 cents at €44.40 and Bayer lost 82 cents at €42.08.

Hochtief fell on concerns that the construction group was about to become embroiled in a legal dispute over alleged industrial espionage. The stock tumbled €1.35 to €42.65.

Paris edged forward for the second day running as investor interest continued to focus on the three big banks involved in a complex take-over dispute. The CAC-40 index ended 21 or 0.5 per cent higher at 4,479.75.

Banque Nationale de Paris (BNP) and Paribas rallied after falling on Monday on news that the former had won control of the latter but had fallen short in its attempt to take over Societe Generale (SocGen).

BNP had made hostile bids for the other two banks in an attempt to prevent them merging. BNP climbed 70 cents or 1 per cent to €74.15 while Paribas rose €2.40 or 2.4 per cent to €104.30.

SocGen succumbed to profit-taking after its 11.8 per cent advance last week, falling €4.90 or 2.6 per cent to €182.10.