European stocks advanced. Royal Philips Electronics NV climbed after UBS AG advised investors to buy the stock. British Airways Plc gained after it reached a pay accord with unions on Friday, averting a strike. The Dow Jones Stoxx 50 gained 0.5 percent to 2681.91 as of 8:27 a.m. in London. The Stoxx 600 rose 0.5 percent, with airlines and technology stocks among the biggest gainers. The Euro Stoxx 50, a benchmark for the 12 countries using the euro, added 0.7 percent. Philips, Europe's largest consumer-electronics maker, climbed 1.9 percent to 18.97 euros. The stock was raised to ``buy'' from ``neutral'' at UBS.
British Airways Plc, Europe's second-biggest airline, added 2.7 percent to 218 pence. The carrier reached a pay accord with unions on Friday, averting a strike planned for the Aug. 27-30 holiday weekend by 11,000 baggage handlers and check-in staff. Rentokil Initial Plc, the world's biggest pest control business, gained 2.3 percent to 157.25 pence. It may receive takeover bids from U.K. venture-capital firms including 3i Group Plc and Cinven Ltd., the Business newspaper reported, without saying how it got the information. Volkswagen AG, Europe's largest carmaker, rose 0.6 percent to 31.06 euros. It plans to freeze wages for about 103,000 employees in contract talks starting next month, magazine Focus said, without saying how it got the information. Vodafone Plc, the world's largest cellular-phone operator, advanced 0.8 percent to 124.75 pence. It has delayed any sale of Arcor AG, its German fixed-line operation, until the end of 2004 at the earliest, the London-based Times reported, without saying how it got the information.
Hoescht, Merck KGaA
Hoechst AG, which merged with Rhone-Poulenc SA of France in 1999 to form Aventis SA, gained 6.6 percent to 55 euros. Sanofi- Aventis, the world's third-biggest drugmaker, will seek to buy the remaining shares it doesn't own in Hoechst and may force that company's stockowners to accept compensation should its offer be rejected, Die Welt reported, without saying where it got the information. Merck KGaA, the world's largest maker of liquid crystals used in displays, shed 4.2 percent to 41.58 euros after saying it expects second-half sales growth in its chemical business to slow on lower-than-expected demand for flat-panel televisions. Crude-oil futures trading in New York rose 0.7 percent to $47.05 a barrel in New York. Oil touched a record of $49.40 Friday on concern Iraqi exports may drop. That was its highest intraday price since oil began trading in that market in 1983. Oil prices will probably extend gains this week, after setting records every day except one since July, on concern that shipments will be curtailed as demand grows, 63 percent of respondents in a Bloomberg survey of 51 traders and analysts said.
U.S. Gains
The S&P 500 rose 3.7 percent Friday, with about two thirds of the gain coming after trading in Europe ended. The benchmark climbed 3.2 percent to 1098.35 for the week, the biggest advance since October. The Nasdaq Composite Index advanced 4.6 percent to 1838.02, the largest gain since April. The Bloomberg World Asia-Pacific Index, which tracks the performance of 1,448 stocks in the region, rose 0.5 percent to 119.90 at 1 p.m. in Tokyo. Crude oil had its biggest drop in two weeks Friday in New York, helping lift the Standard & Poor's 500 Index to its largest weekly gain in 10 months. ///www.bloomberg.com