World Equity Prices Rose

Initial reports suggest Hurricane Rita didn't do as much damage to fuel production as feared

MARKETSCOPE : World equity prices rose on Monday, after news that Hurricane Rita hadn't done as much damage as feared.

In London, the Financial Times-Stock Exchange 100 index was up almost 30 points at 5443.40. 79 FTSE stocks were higher and 20 lower on turnover of 631,620,000 shares. Tesco rose 0.79% after weekend press reports it has appointed a 65-strong team of top executives in the US to value the possible acquisition of a grocery store chain in America. Smaller peer Somerfield fell 1.01%, however, after news that United Co-Ops is pulling out of talks to buy 500 stores from London & Regional, the property group that is considering a bid for it. BP fell 0.68% as crude oil prices retreated. Old Mutual rose 0.93% amid hopes it will be able to snatch Skandia, despite board opposition.

In Frankfurt, the DAX Index was up 87 points to 4969.36 level. 28 DAX stocks were higher and 1 was lower on turnover of 66,765,412 shares. Bayer climbed 2.7% and BASF was up 2.89%, after the companies escaped major damage to their Texas plants. Munich Re climbed 2.63% and Hanover Re rose 4.44%. In other news, Porsche dropped 8.96% after news that it intends to buy a 20% stake in VW (which rose 1.83%). Porsche, which already owns 5% of VW, is seeking to prevent a hostile takeover of the group, but the business logic is questioned. E.on rose 1.54% amid news that it was buying Caledonia Oil & Gas, the privately-owned UK company with lucrative gas assets in the North Sea, for EUR 690m. Deutsche Telekom gained 1.07% amid reports that it is plotting a GBP18bn takeover of UK's O2, according to The Business.

Paris' CAC 40 was up 70 points to the 4547.00 level. 38 CAC stocks were up and 2 were down on turnover of 68,025,630 shares. In Paris, investors eyed Axa (+2.7%) and the insurance sector, which is expected to face a modest bill of between US$3 billion and US$6 billion vs. US$35 billion to US$45 billion for Katrina. SocGen rose 2.7% after La Tribune reported it is eyeing Ukrsibbank in the Ukraine and Podgoricka Banka in Montenegro. Air France climbed 1.09% after announcing it is raising passenger capacity by 6.4%. Ipsos surged 7.07% after SocGen gave the stock two consecutive target price lifts last Friday and today. EADS rose 3.35% after news it is hiring a bigger workforce in a bid to increase output in the next two years. Publicis gained 1.11% after news Omnicom does not plan to bid for Aegis.

Japan's Nikkei 225 jumped 233.27 points (1.77%) to 13,392.63, boosted by a rise in the government's third quarter corporate sentiment survey. The pullback in energy prices, as Rita's impact on Gulf of Mexico oil facilities was not so devastating, contributed to positive sentiment. Besting the tech-laden Nikkei 225, the broad-based TOPIX index surged 30.27 points, or 2.23%, to a four-year high of 1386.49.

Stocks in Hong Kong rose with additional help from buying related to the expiration of the September Hang Seng futures contract later this week. The Hang Seng index ended slightly below its session high following an afternoon rally.

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