LONDON: European stocks bounced back onThursday, shrugging off a flat start on Wall Street, as risingtelecoms shares helped reverse a two-week decline.The dollar clawed back above 104 yen in nervy tradingas expectations faded that Saturday's Group of Seven meetingwould result in joint intervention to halt the yen's rapid rise.Crude oil prices shot up over 50 cents after OPECagreed to stand firm on supply cuts that have doubled pricesthis year, reports Reuters. European government bonds recovered early lossesto trade flat, reacting little to the European Central Bank'sdecision to leave key interest rates unchanged.
U.S. Treasuries , virtually unchanged, similarlyignored official unemployment data showing American joblessclaims at its lowest level since 1974.
European shares started up briskly after a brighterovernight performance from Wall Street, with telecoms stocksleading the way.
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GOLD $264.40/264.90 +1.25 (pvs PM fix) BRENT $23.48 +0.55
FTSE 5975.2 +61.30 CAC 4,582.27 +14.15 DAX 5291.22 +52.46-------------------------------------------------------------------------------------------------- At 1400 GMT the pan-European Eurotop index of 300shares was up 14.02 points or 1.09 percent at 1301.52 while thenarrower Euro Stoxx index of 50 blue chip euro zoneshares was up 30.55 points or 0.82 percent at 3743.96.
German telecoms and engineering group Mannesmann AG soared over eight percent after saying it woulddivide into two joint stock companies, one covering engineeringand automotive activities, the other telecoms.
Telecoms were also lifted by a 4.5 percent gain in Britain'sVodafone AirTouch Plc , extending its advance to a recordhigh after releasing details earlier this week of a jointventure with Bell Atlantic in the United States.
Sector heavyweight Deutsche Telekom gained twopercent after the New York Times reported that Sprinthad been in merger talks with the German company.
The media sector was one of the few decliners,weighed by a 13 percent tumble in British news and informationgroup Reuters as analysts cut earnings forecasts after ameeting with the group's Instinet agency broking unit in NewYork.
VIRTUAL PAN-EUROPEAN BOURSE PLANNED
The auto sector was dragged lower by a 2.5 percentfall in DaimlerChrysler to a new year low on concernsover an anticipated top management reshuffle.
Sweden's Volvo rose 2.3 percent amid renewedrumours of a possible bid from Germany's Volkswagen ,down two percent.
Eight European stock exchanges said on Thursday they willlaunch a "virtual" pan-European bourse via a common electroniclink in November 2000 -- earlier than planned, but not thesingle trading platform originally trumpeted.
On Wall Street the Dow Industrial Average was down3.17 points or 0.03 percent at 10,520.9 at 1400 GMT. Thetechnology-heavy Nasdaq was up 2.83 points or 0.10percent at 2,860.99.
In the foreign exchange markets the dollar recovered someground against the yen, but was hampered by market caution aheadof the G7 finance ministers' meeting in Washington on Saturday.
Expectations are fading that the meeting will result injoint intervention to halt the yen's rapid rise and so protectJapan's recovering economy, but trade remained hesitant ahead ofthe meeting, dealers said.
Volume was further dampened by a market holiday on Thursdayin Japan.
The dollar was trading around 104.30 yen, from an earlierone-week low of 103.44. The dollar touched a 3-1/2-year low of103.17 yen on September 15.
The euro edged up to 108.70 yen from an earlierlow of 108.15, but was softer from 109.31 in Thursday's lateEuropean trade. Against the dollar the euro was weaker,down around one cent at just above $1.04.
Benchmark Brent crude blend futures traded above $23.50,some 50 cents up on the day, as the market bet that the OPECcartel's commitment to limit supplies will send prices soaringeven higher as the northern hemisphere winter looms.