Madrid shares close lower, Telefonica under pressure UPDATE

Madrid shares close lower, Telefonica under pressure UPDATE

	Published : Tue, 09 Jan 2007 19:03 By : Agencies Print this Story

(Updates with full report)

MADRID - Share prices closed slightly lower, underperforming Europe after a late sell off of Telefonica on concerns about its Venezuelan business curbed early gains, dealers said.

The IBEX-35 index closed 10.8 points lower at 14,311.5, after trading in a range of 14,288-14,417 on volume of 7.4 bln eur.

The January future on the IBEX-35 index closed at 14,294, down from 14,302 Monday on volume of about 13,880 contracts.

Equities opened higher after a positive performance on Wall Street overnight and extended their advance over the morning in line with European markets.

But the Ibex-35 gave up gains throughout the afternoon following a sell off of Telefonica shares.

Telefonica was down 0.11 to 16.84 after trading in Venezuelan peer CANTV, in which it holds 6 pct, was halted in New York following a 14 pct drop. The stock plummeted following comments from Venezuelan president Hugo Chavez suggesting a possible nationalisation of telecoms and energy companies.

NH Hoteles was the highest gainer of the day, up 0.38 eur or 2.47 pct at 15.74 amid renewed rumours of interest by hotel group Accor.

Cintra was also a favourite, up 0.26 or 2.13 pct at 12.45, after BNP Paribas hiked its price target to 14.25 eur per share from a previous 13.90, on the back of 'excellent' December traffic figures.

Selected constructors were also in demand, with Ferrovial 1.25 higher at 72.35, Metrovacesa up 0.90 at 124.10 and Acciona adding 1.85 to 138.65.

Retail banks were ahead in anticipation of full year results, with Banesto up 0.24 at 17.80 in the last session before releasing Q4 earnings tomorrow, and Banco Popular up 0.12 to 14.44.

Repsol YPF underperformed, losing 0.48 to 25.47, after Deutsche Bank's downgrade to 'sell' from 'hold', citing weak growth prospects and tracking BP after a weak trading update.

Gamesa slipped 0.56 to 20.87 on profit taking from recent gains.

BBVA was up 0.06 at 18.759, SCH was flat at 14.43 and Endesa rose 0.23 to 35.443.

Selected utilities also dragged, with Fenosa down 0.51 at 36.62, Gas Natural off 0.36 to 29.88, REE 0.20 lower to 29.33 and Iberdrola sliding 0.01 to 32.57.

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