European markets rallied strongly as concerns about a rise for US interest rates lost some of their sting. The reprieve may prove temporary but their was no stopping investors and the leading FTSE indices all rose more than 2 per cent.
The FTSE Eurobloc 100 index added 2.3 per cent at 1,048.82 and the FTSE Eurotop 100 index gained 2.2 per cent to 2,895.36. The broader FTSE Eurotop 300 index improved 2.1 per cent at 1,267.15.
Frankfurt had its best day since the third week of June, rising 107.74 to 5,127.43 on the Xetra Dax index.
Acquisition speculation pushed Deutsche Telekom up €1.85 or 5 per cent to €39 after investors latched on to a media story that the telecoms giant was about to take a strategic stake in Singapore Telecom.
MAN was also in demand, adding 95 cents at €32.35 amid talk that Volvo, the Swedish motor giant that recently expanded its truck empire with the purchase of Scania of Sweden, was teeing up further takeovers.
Paris powered forward by 2.3 per cent. Insurer Axa, boosted by broker optimism, remained in demand, gaining €6.30 or 6.1 per cent at €109.4 on the back of good results from Sun Life, its British offshoot.
Oils continued to find ready buyers as speculation about the eventual outcome of the takeover tussle between TotalFina and Elf Aquitaine reached dizzier heights.
Total gained €6.40 at €129.70 and Elf €8.30 at €176. Amsterdam pushed higher as financials and selected internationals met saw steady buying. The AEX index ended 11.46 better at 553.31.
The more relaxed interest rate background sent financials steeply ahead. ABN Amro gained 40 cents to €19.80 and ING 1.55 at 47.65. Among internationals, Philips rose €3.20 at €92.30 and Royal Dutch €2.55 at €61.90.
Zurich found support in the firmer dollar and stable bond prices. Financials benefited from the waning interest rate worries, with UBS SFr16.50 higher at SFr429 and CS Group SFr5 better at SFr263.
