Stock Markets in Canada, Brazil Rally; European Shares Close Mostly Higher
Friday December 8 3:05pm
Source: Dow Jones
NEW YORK -- Stock markets in Toronto and Sao Paulo rose sharply Friday, supported by a rally in U.S. shares as investors shrugged off a profit warning from Intel to focus on the latest monthly employment report.
Earlier, European shares closed mostly higher, led by gains in technology shares.
In Tokyo, the Nikkei stock average finished slightly lower in lackluster trade as many investors stayed on the sidelines ahead the U.S. employment news. Shares rallied in Hong Kong and South Korea.
The Toronto Stock Exchange's 300 composite index soared 381.93 points, or 4.2%, to 9548.73. Advancing shares led decliners 655 to 406 and trading volume was 192.1 million shares, up from Thursday's total of 147.6 million shares.
All but one of the TSE's 14 stock groups rose with the industrial products sector surging 8.6% to lead advancers. In the group, Nortel Networks climbed 11%, while JDS Uniphase added 8%.
Intel, the world's leading semiconductor manufacturer warned late Thursday that it wouldn't meet fourth quarter expectations, citing slower personal computer sales. Intel now expects fourth-quarter sales to total $8.7 billion, which would be unchanged from third-quarter sales.
With both Gateway and Apple Computer citing slower personal computer sales in their own profit warnings in the past week, Intel's announcement wasn't a surprise, analysts said.
The U.S. unemployment rate for November rose to 4%, as expected, but nonfarm payrolls rose by 94,000 people, well below expectations of a 148,000 increase.
The figures reinforced the opinion that the U.S. economy is slowing down, which may compel the Federal Reserve to lower interest rates.
On Friday, the Dow Jones Industrial Average gained more than 95 points, or 1%, and the technology-heavy Nasdaq Composite Index surged nearly 165 points, or 6%.
But after the close of the New York trading session, many shares dropped in after-hours dealings in response to a surprise Florida Supreme Court ruling that threw more uncertainty into the outcome of the U.S. presidential election. The decision upheld Democratic presidential candidate Al Gore's appeal for recounts in parts of Florida.
In Sao Paulo, the main Sao Paulo index, or Bovespa, rose for a second straight day, climbing 523.01, or 3.6%, to 14982.99, amid improved regional sentiment and higher U.S. exchanges.
Traders said that in addition to being buoyed by Wall Street, the market was supported by a 2001 budget deal in Argentina and rumors that Standard & Poor's may soon upgrade its ratings on Brazil.
Stocks rose across key sectors, lead by long-distance carrier Embratel's preferred shares, which gained 9.2%.
Preferred shares of cable television provider Globo Cabo rose 8.8%, while preferred shares of Telemar rose 3.8%.
In Mexico City, the IPC index edged up 9.73 points, or 0.2%, to 5795.09. Trading was lackluster despite U.S. market gains amid uncertainty regarding next week's congressional debates on Mexico's 2001 budget, which was submitted this week and may draw some market attention, although a reasonably smooth passage is expected.
Retailer Walmart de Mexico C shares rose 4.5%.
In London, the Financial Times Stock Exchange 100 Share Index rose 56.9 points, or 0.9%, to close at 6288.3.
The Xetra DAX Index in Frankfurt closed up 125.17, or 1.9%, at 6691.25.
However, the CAC 40 Index in Paris fell 45.37, or 0.8%, to 5939.32.
It was too early to say whether Friday's gains in the ever-volatile technology stocks are the beginning of recovery, said Alex Scott, an analyst with Barclays Stockbrokers in London. "We need to see two to three weeks of a sustainable positive trend, and then I think we can probably say the worst is over," Mr. Scott said.
Networking company Bookham Technology led gainers in London, rising 14%, while Colt Telecom rose 9.4%.
British Telecom gained 5%, with the company at the center of speculation on unconfirmed reports that is was looking at AT&T Corp.'s share of Japan Telecom Co.
Software manufacturer SAP jumped 7% in Frankfurt. Chip maker ASM Lithography climbed 5.3% in Amsterdam. Alcatel rose 1.7% and France Telcom edged up 0.1% in Paris.
But the overall Paris market was tugged lower as shares of Canal Plus fell in late trading on profit-taking as it lost 3.8% after the market initially received the news of shareholders' approval of the three-way merger with Vivendi and Seagram positively.
French retailer Carrefour fell 3.5% following the release late Thursday of weaker than expected November sales figures. It is the second month in a row Carrefour has reported disppointing monthly figures.
Elsewhere in Europe, the SX General index in Stockholm rose 1.6%, the AEX in Amsterdam gained 0.1% and the Mibtel index in Milan rose 0.3%. But the Swiss Market index slipped 0.3%. The Madrid market was closed for a holiday.
In Tokyo earlier, the Nikkei 225 index slipped 23.85, or 0.2%, to 14696.51.
Investors are watching to see if Morgan Stanley Capital International will adjust its indexes based on a newly introduced, free-float adjusted method.
In Hong Kong, investors shrugged off the weak tone set by the U.S. markets. The Hang Seng Index rose 117.81, or 1.2%, to close at 15189.33, finishing at a two-week high, mostly because of a sharp rise in the share price of Pacific Century CyberWorks.
The Hong Kong telecommunications giant outperformed all the other blue chips to jump 8.3% in heavy trading.
Buying in telecom issues also helped the South Korean market. The Kospi climbed 11.03, or 2.1%, to 534.81.
SK Telecom and Korea Telecom soared on hopes the companies will win third-generation mobile-phone licenses.
Taiwan's weighted index rose 0.8% as prospects of mergers in the banking industry encouraged buying of financial stocks.
The main stock index in the Philippines rose 0.7% in light trading on a mild technical recovery as bargain hunters nibbled on select blue chips that have reached oversold levels.
But Australian and Malaysian shares closed lower as investors bet on the likely outcome of this weekend's reworking of the Morgan Stanley Capital International index. The All Ordinaries index in Sydney fell 0.6% and the KLSE composite in Kuala Lumpur slipped 0.3%.
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