European stocks end higher

European shares closed higher for the first time in six sessions yesterday, after oil fell from record highs despite Hurricane Katrina pounding the US Gulf coast, while tech and telecom stocks rose.

US light crude hit a high of $70.80 a barrel to drag shares sharply down at the open on concerns about the impact on corporate profit and consumer spending but oil eased through the day as the hurricane was downgraded.

Oil firms still benefited from the high price with Italy's Saipem and Austria's OMV among lead gainers in Europe, where trading was very quiet with London markets closed for the August bank holiday.

The FTSEurofirst 300 index of pan-European blue chips unofficially closed 0.3 per cent firmer at 1,167.2 points, having closed down every day last week.

The narrower DJ Euro Stoxx 50 index rose 0.4 per cent to 3,238.5 points.

"The market's attention is currently geared towards movements in the oil price, and we believe this is likely to remain the case for some time to come," Commerzbank strategists said in a note.

"Oil in the high $60s a barrel could well be part of a new economic environment. The question is how bad is it going to be? We argue that it is not that bad."

Hurricane Katrina has disrupted US oil and gas production in the Gulf of Mexico but investors on Wall Street shrugged off the concerns to push the Dow Jones industrial average higher, helping to give European bourses a late boost.

Paris's CAC-40 closed up 0.4 per cent, Zurich's SMI gained 0.3 per cent and Frankfurt's DAX was 0.6 per cent higher.

Finnish cellphone handset maker Nokia offered support, rising one per cent after it said it had reached a settlement with Turkey in its claims against network operator Telsim.

Nordic telecoms firm TeliaSonera was also strong, adding 1.6 per cent after it signed a deal to buy Norwegian mobile firm Chess.

Swiss drug firm Novartis gained one per cent on news US regulators have agreed to speed up their review process on whether to allow the use of the company's Femara medicine in women with breast cancer immediately following surgery to remove a tumour.