Old-economy stocks send Paris back up

The market in Paris edged back up towards its recent record high, with old-economy shares making most of the progress as a handful of companies reported good results.

Carmaker Peugeot rose 4.7 per cent to €224 after it reported strong first-half results. Three investment banks raised their earnings-per-share targets for the stock: Goldman Sachs, Morgan Stanley Dean Witter and SG Securities.

Oil company Total Fina Elf added another 1.1 per cent to close at a record high of €183, lifted by its results this week and the ever-rising oil price. SG Securities raised its share-price target to €220 from €200.

European aerospace group EADS hit its highest level since it began trading two months ago, buoyed by a jump in rival Boeing of the US. EADS shares closed at €19.05, a rise of 4.4 per cent.

Frankfurt gained ground with further weakness for technology stocks and chemicals offset by some strong individual features.

Deutsche Telekom came off 85 cents at €45.90 and Epcos 80 cents at €110.30 as an early rally for the Nasdaq failed to fully restore the damage done in recent sessions to tech-related sentiment.

Chemicals continued to suffer from negative broker comment and worries about softening sales and squeezed trading margins. BASF shed €1.07 at €42.58 and Bayer €1.05 at €45.75.

Schering, where the sales base is more pharmaceuticals than basic chemicals, rose as investors continued to warm to Wednesday's upbeat trading statement. The shares added €4.80 or 8.1 per cent at €64.

Insurers, lifted on Wednesday by positive comment from Goldman Sachs, stayed in demand. Allianz added €6.50 at €395.50 and Munich Re €4.20 at €330.

Oil price and, therefore, fuel cost concerns continued to gnaw at Lufthansa, sending the shares down €1.15 or 4.8 per cent at €22.95.

Amsterdam shed 0.11 at 694.90 on the AEX index after a bad day for the chemicals heavyweights and renewed profit-taking at cable TV group UPC.

DSM lost 63 cents at €34.05 and Akzo Nobel 25 cents at €49.25 as sentiment in the European chemicals sector soured on trading concerns. UPC met with a renewed round of profit-taking. The stock plunged to €26.70 before closing off €1.50 at €28 in 8.2 million shares traded. News of a $1.1 billion bid for a Spanish supermarket chain sent Ahold down €1.45 or 4.4 per cent to €31.66.