Nikkei 225 at an eight-week high

European shares pulled back from the three-year highs set in the previous session yesterday after Wall Street gave back early gains overnight and oil prices rallied over $55. The FTSE Eurofirst 300 rose 0.1 per cent to 1,136.07 by mid-afternoon, while London's FTSE 100 was flat at 5,048.82.6, Germany's Xetra Dax fell 0.1 per cent to 4,593.22 and France's CAC-40 slipped 0.2 per cent 4,194.44.

France's BNP Paribas announced the acquisition of Commercial Federal Corporation of the US for $1.4 billion. The French bank, which made the move through its BancWest subsidiary, said it expected to achieve cost savings of around $54 million.

Wall Street stocks rose slightly yesterday on the back of lower oil prices and better-than-expected producer prices data that eased concerns over the outlook for monetary policy. The Dow Jones Industrial Average was up 0.2 per cent at 10,547.34 as the broader S&P 500 Index inched up 0.1 per cent to 1,202.5. The Nasdaq Composite Index was up 0.2 per cent at 2,072.67. In Japan the Nikkei 225 inched up to an eight-week closing high yesterday, boosted by the dollar's rise against the yen to its highest point so far this year. The tech-heavy Nikkei 225 rose by 0.2 per cent to close at 11,335.92. The broader-based Topix rose by 0.1 per cent to 1,150.33.

Despite the gains, analysts were doubtful that the Nikkei would rise much further, given the weakness of some sectors heavily exposed to either the domestic or Chinese demand.