Wednesday July 18, 01:25 PM
Takeover news caps falls on European stock markets
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LONDON (AFP) - European stock markets tumbled on fears of a sell-off on Wall Street, but losses were capped by takeover activity in the tobacco and retail sectors, dealers said Wednesday.
London's FTSE 100 (news) index of leading shares shed 0.79 percent to 6,606.60 points in early afternoon trading.
In Frankfurt the DAX 30 (Xetra: news) slid 1.42 percent to 7,924.13 points, the Paris CAC 40 lost 1.04 percent to 6,035.67 points and the DJ Euro Stoxx 50 (Zurich: news) index of top eurozone shares declined 0.91 percent to 4,496.95.
The euro stood at 1.3784 dollars after earlier striking a record high 1.3837.
Japanese share prices closed down more than 1.0 percent on Wednesday on concerns that Wall Street could fall sharply at its open following lacklustre results from US corporate heavyweights Intel (NASDAQ: INTC - news) and Yahoo (NASDAQ: YHOO - news) , which were released after Tuesday's close, dealers said.
Wall Street's blue-chip Dow Jones (news) index vaulted Tuesday above 14,000 points for the first time as investors remained upbeat on the economy and corporate earnings, but failed to hold that level at the close.
In London on Wednesday, the FTSE's biggest faller was sugar producer Tate & Lyle (LSE: TATE.L - news) , which slid 2.92 percent to 582.5 pence after the company warned that its first quarter-profit would be lower than a year earlier.
On the upside, Imperial Tobacco (LSE: IMT.L - news) jumped 1.23 percent to 2,228 pence after it said it would strengthen its position as the world's fourth largest tobacco group after Franco-Spanish rival Altadis (Madrid: ALT.MC - news) accepted a cash takeover worth 16.2 billion euros.
A tie-up between the world's fourth and fifth biggest tobacco groups, which is the equivalent of 22.4 billion dollars, would marry Imperial Tobacco brands Regal, Embassy and Davidoff with Altadis' Gauloises and Fortuna.
Altadis gained 1.10 percent to 48.63 euros on Madrid's IBEX 35 (Madrid: news) index, which was falling overall.
Back in London, Britain's third supermarket J Sainsbury won 1.37 percent to 593.5 pence after announcing that it had received a takeover approach from a Qatari investment group.
According to the Financial Times, Delta Two has offered 610 pence per share, or about 12 billion pounds (17.8 billion euros, 24.6 billion dollars) for the group.
In Asia, the Tokyo Stock Exchange's benchmark Nikkei (news) -225 index of leading shares shed 1.11 percent to close at 18,015.58 points on Wednesday.
Hong Kong's key Hang Seng Index fell 0.93 percent to 22,841.92 points, as worries over possible economic tightening measures in China prompted investors to lock in gains, dealers said.
On Wall Street, the Dow Jones Industrial Average closed up 0.15 percent at 13,971.55 points Tuesday, setting a fourth-straight record close despite paring its early gains.
The tech-heavy Nasdaq composite (NASDAQ: news) rose 0.55 percent to 2,712.29 points and the broad-market Standard Poor's 500 index, which also flirted with record highs, dipped 0.01 percent lower at 1,549.37.
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