US Markets - Global equities shrugged off the rout in government bonds this week, with markets on both sides of the Atlantic set to close on Friday near to all-time highs.

Equities were under heavy selling pressure in the week as the yield on the 10-year US Treasury bond hit a five-year high at 5.33% amid concerns that strong US growth would rule out interest-rate cuts this year.

Attention has focused on whether the recent rise in bond yields will damp what has been a frenetic pace of merger and acquisition activity. On Friday, there were signs that deal activity was picking up and Home Depot, up 0.4% at $37.95, received two separate bids for its wholesale supply unit. Among sectors in the vanguard of this week’s rebound was energy, as oil prices hit nine-month highs. Rate-sensitive utility stocks rallied, while higher commodity prices buoyed materials and industrial stocks.

However, the rise in yields pushed mortgage rates sharply higher and the home builder and real estate investment trust sectors declined.

The leading index this week was the Nasdaq Composite. The technology benchmark rose 1.05% to 2,626.71 on Friday, a rise of 2.1% over the week. Semiconductor stocks rallied 2.8% this week, led by a 11% rise to $24.24 for Intel. The chipmaker was upgraded to a “buy” on Friday by Goldman Sachs.

The S&P 500 rose 0.65% to 1,532.91 on Friday, a gain of 1.7% this week. It was up from a low of 1,492.97 on Tuesday and was near its recent closing record of 1,539.18.

The Dow Jones Industrial Average gained 0.6% to 13,639.48 on Friday, a rise of 1.6% this week. The blue chip barometer was just shy of its recent record peak of 13,692. The Dow Transportation Average rose 1.1% this week, taking its gain this year to 13.5% as the sector rebounded from a sharp slide on Tuesday, when it hit its lowest level since mid April.

Leading the blue chips this week was General Motors, up 11.8% to $34.66 as investors cheered hopes for a union settlement over Delphi, the car maker’s former parts unit, that would help GM’s restructuring efforts.

Ford rose 8.2% to $8.92 this week, after it hired banks to advise on the sale of its Jaguar and Land Rover divisions.

Deal talk this week focused on the exchange sector. Shares in Nymex rose 1.7% to $142.12 on Friday, for a gain of 13.5% this week, amid reports that it was seeking to merge with another exchange.

The tug of war over CBOT Holdings, between the InterContinental Exchange and the Chicago Mercantile Exchange took a couple of twists.

The CME and CBOT revised the terms of their merger agreement and will provide a special dividend to all CBOT shareholders. This followed a move by ICE on Tuesday to include a cash component in its bid for the CBOT. Shares in CBOT rose 4.3% to $206.98, CME was up 0.6% at $552.70, while ICE gained 7.8% to $156.98.

The S&P steel index fell 4.9%, trimming its gain in 2007 to 27.9% as consolidation talk cooled. Nucor slid 5.4% to $63.02 after the steelmaker warned that its second quarter earnings would be well below analysts’ expectations.

A number of stocks either hit record or 52-week highs.

Eastman Kodak set a 52-week high of $30.20, and rose 10.3% to $29.31. It said it had created image-sensor technology to allow photography in poor light.

Freeport-McMoRan rose to a record high of $84.90 amid higher copper prices and news that the miner will sell some assets. Shares in the company gained 10.8% to $84.42 this week.

Apple hit a record high of $127.61 before investors cashed in after the company’s annual Developers Conference in San Francisco passed with no major new product news. The stock fell 3.2% to $120.50.

In earnings news, subprime mortgage woes clipped fixed income results at Bear Stearns and Goldman Sachs. For the week, Bear was up 1.5% at $150.09, and had pared its 2007 loss to 7.8%. Goldman rose 0.5% to $226.19, taking its gain in 2007 to 13.5%.

Lehman posted a 27% rise in second quarter earnings to a record $1.3bn and its stock rose 6.6% to $79.07. Morgan Stanley fell 0.9% to $88.48 on Friday.

Fortress Investment Group slumped 6.5% to $23.47 on Friday, as proposed legislation could raise taxes for the private-equity and hedge fund.

Dean Foodsfell 3.5% to $31.23 after it cut earnings estimates for the second quarter.

Smith & Wesson reported stronger-than-expected fourth-quarter profit and sales. The gun maker also raised its full-year profit and sales forecasts. Shares rose 8.3% to $16.15 and closed at a 52-week high.

Shares in Monsanto jumped 7.3% to $64.86, this week and on Friday the agriculture concern raised its earnings outlook for fiscal 2007 following a surge in corn plantings this year.

European Markets - The recovery in European equity markets this week was driven by steadying bond yields, and helped resource stocks pave the way for a broad rally.

Last week’s sharp correction was reclaimed as confidence appeared to return. The FTSE Eurofirst 300 was close to striking a new six-year high, up 3.7% on the week to 1,625.87.

In Germany Frankfurt’s Xetra Dax powered though the 8,000 level to hit a fresh seven-year high, and came within striking distance of its 8,136.16 record hit in March 2000. The German benchmark ended the week 5.8% higher at 8,030.64, its best weekly performance since October 2003.

German shares closed higher above the 8,000 point level in a broadly positive market led by Deutsche Boerse and Hypo Real Estate.

The DAX ended 181.48 points or 2.31% higher at 8,030.64 after trading between 7,860.33 and 8032.97.

The MDAX was up 137.84 points or 1.26% to 11,089.55 while the TecDAX was 19.13 points or 2.08% higher at 937.57.

DAX futures were higher 186,00 points or 2.35% at 8,117.00 while bund futures were up 0.05 at 110.11.

Deutsche Boerse was the top performer, adding 4.28 Eur or 5.05% at 88.99 followed close by Hypo Real Estate, up 2.13 or 4.41% at 40.53.

Morgan Stanley raised its price target for Hypo Real Estate to 60 Eur per share from 54 and reiterated it 'overweight' stance.

TUI added 0.70 or 3.68% at 19.72.

On the downside, SAP  was down 0.02 or 0.05% at 35.56.

Banking stocks were the focus of investor interest after Berlin city announced it is selling its 81% stake in Landesbank Berlin to state-owned DSGV German Savings Banks Association for 4.622  Billion Eur.

Commerzbank, one of the bidders for Landesbank Berlin, gained 1.29 or 3.63% at 19.72 after Berlin city announced it is selling its 81% stake in Landesbank Berlin to state-owned DSGV German Savings Banks Association for 4.622  Billion Eur. Traders thought DSGV's winning bid was too steep.

Siemens was up 4.40 at 107.18 after US private equity firm KKR appointed former Siemens CFO Heinz - Joachim Neubuerger - as an adviser, sparking rumours a takeover of its VDO unit may lie ahead.

E.ON closed up 3.68 or 3.12% at 121.79. JP Morgan added the utility to its Analyst Focus list, saying further analysis of E.ON's growth target suggests it can be comfortably beaten.

On the MDAX, Norddeutsche Affinerie led with a gain of 3.38 or 11.45% at 32.90 on news A-TEC Industries has acquired a 10% stake in the copper specialist.

IVG Immobilien was down 0.78 or 2.61% at 29.15.

TecDAX-listed Kontron was up 0.78 or 5.65% at 14.58 while Aixtron lost 0.10 or 1.54% at 6.39.

Into France where in Paris the market closed sharply higher in line with the rest of Europe.

The CAC-40 index finished up 58.05 points or 0.96% at 6,105.28, on strong volume of 11.34  Billion Euro.

Among CAC-40 stocks, 33 closed higher and 6 closed lower.

On the Matif, June CAC-40 futures were trading up 50.5 or 0.83% at 6,099.5.

On the broader indices, the SBF-80 index closed up 79.97 or 1.10% at 7,376.10 while the SBF-120 finished up 43.25 or 0.98% at 4,456.01.

EADS led CAC-40 risers, closing up 0.85 Eur or 3.63% at 24.28.

The aeronautics group was lifted by expectations that next week's Paris Air Show will bring in a batch of orders, while investors were also reassured by French prime minister Francois Fillon's comment in Le Figaro this morning that EADS is 'strategic' for both France and Europe.

Natexis Bleichroeder analysts raised their target price to 28 Eur on the grounds that EADS' recovery potential has not yet been priced in by the market.

Outside the CAC-40, Dassault Systemes put in a strong performance, surging 1.85 or 4.12% to 46.70, on unconfirmed M&A rumours.

A local dealer said there was talk that Groupe Industriel Marcel Dassault (GIMD) is looking to sell its 44% Dassault Systemes stake to IBM, although he added 'we really don't believe it.'

Back in the CAC-40, automobile stocks continued to find favour, with Renault ending the day up 1.77 or 1.56% at 115.41, Peugeot closing up 1.26 or 2.13% at 60.29 and Michelin ending up 1.55 or 1.54% at 102.00.

Steel tube-maker Vallourec added 4.70 or 2.01% to close at 239.00 on continuing takeover speculation.

On the second line, mid cap Zodiac rose 1.80 or 3.07% to finish 60.47 after it met expectations with its nine-month sales and also confirmed its full-year guidance for earnings per share growth of more than 10%.

On the downside, Sanofi-Aventis was among the main blue-chip fallers, dropping 0.35 or 0.56% to 62.65. The small dip added to its sharp fall yesterday triggered by the rejection of anti-obesity drug Acomplia by a panel advising the US Food and Drug Administration.

Into Belgium now where we saw Brussels follow the rest of Europe in closing higher, the Bel 20 ending up 0.89% to close at 4,681.67.

Major movers included Cofinimmo (up 4.28%), Umicore (+2.45%), KCB (+1.5%) and UCB (+2.79%).

KBC said its private equity unit has sold its 30% stake in the D&D Media Group to the pan-European private equity fund, Palamon Capital Partners.

Fortis was upgraded to 'accumulate' from 'reduce' at KBC Securities, where the target price was also increased to 34.0 Eur from 30.0, as the share's recent decline now leaves potential upside.

The group's share price has declined steadily since it announced, along with consortium partners Royal Bank of Scotland and Banco Santander Central Hispano, its bid for Dutch peer ABN Amro.

French prime minister Francois Fillon reiterated that alternatives exist to the planned merger between Gaz de France and Suez, while also pledging that the government will not increase VAT if there is a risk of higher prices for consumers.

In an interview published today in Le Figaro, Fillon said that the GDF-Suez deal is 'pertinent' but that the government is looking at 'alternatives' for state-owned GDF.

Into The Netherlands and in Amsetrdam the market closed strongly higher after traders welcomed US inflation figures, adding to the already positive sentiment as European markets rebounded from losses earlier this week, with ASML leading AEX gainers.

The AEX closed 6.57 points or 1.20% higher at 551.91, after trading in a range of 546.22-552.37.

ASML gained 4.22% at 20.02 Eur after its price target was upgraded at Rabo Securities and ING Research on its 960  Million Eur capital restructuring programme, which involves an 8-for-9 reverse share split.

Midcap semiconductor peer ASMI also profited, rising 0.41% to 19.78.

Blue chip staffing stocks also performed well, with Vedior closing 4.18% higher at 22.66 and Randstad up 2.12% at 59.38, while midcap peer USG People lost 1.45% to 33.20.

Corporate Express climbed 2.78 Eur to 10.71, Unilever put on 2.35% to 22.68 and Royal Dutch Shell climbed 2.10% to 29.60.

Rodamco Europe finished 2.66% higher at 107.28. The stock gained almost 6 Eur this week amid speculation that Australia's Westfield could launch an alternative bid for the property group, outbidding France's Unibail.

Among financials, Aegon performed best, rising 1.89% to 15.09, while ING put on 1.78% to 33.16 after an upgrade to 'buy' from 'hold' at Theodoor Gilissen.

Takeover target ABN Amro rose 0.64% to 35.91 amid news that some of its shareholders are suing Bank of America over the sale of its unit LaSalle, while news emerged yesterday that Bank of America's US damages lawsuit against ABN Amro has been postponed until July 27.

Heineken rose 1.99% to 44.51 after yesterday's announcement that the Dutch beer giant will buy a Czech brewery from Radeberger Gruppe KG.

KPN rose 1.61% to 12.62 Eur after it was upgraded to 'overweight' from 'equal-weight' at Morgan Stanley, with an increased price target of 14 Eur from 12.50.

Getronics led midcap gainers, surging 3.07% to 5.37 Eur the company said it will sell its Spanish and Portuguese operations to Tecnocom for 95  Million Eur.

Tele Atlas closed up 3.05% at 16.53 Eur, Wereldhave gained 1.06% to 104.74 and Stork put on 0.93% to 41.29.

There were few decliners.

DSM fell 2.56% to 36.87 amid news it will restructure its medical business and that it expects a 110  Million Eur impairment after tax in Q2.

Into Switzerland now where in Zurich Share prices closed sharply higher with positive sentiment underpinned by Zurich Financial and Novartis among the market's top performers.

At the close, the Swiss Market Index was 103.45 points or 1.1% higher at 9,395.75, while the Swiss Performance Index was up 79.56 points at 7,648.79.

The Euro was slightly higher against the Swiss franc to 1.6610 sfr, while the Dollar fell to 1.2428 sfr.

Some of the market's most heavily weighted stocks were among the best performers, with Novartis climbing 2.2% or 1.45 to 69.80 sfr, helped by positive study results for blood pressure treatment Prexige.

Rival Roche was up 1.70 at 220 sfr.

Major gainers included insurers Zurich Financial, closing 2.5% or 9.50 sfr higher at 389.50, and Swiss Re, up 2.20 at 116.50.

Givaudan was another major gainer, rising 2.3% or 27 sfr to 1,209.

Elsewhere in the sector, Syngenta added 3.20 sfr to 236.10, after its ratings were lifted to A/A-1 by S&P, with the rating agency citing the agribusiness firm's healthy balance sheet.

In the banking sector, UBS climbed 0.75 sfr to 77.90, and Credit Suisse rose 0.60 to 91.75.

Shares in food giant Nestle were up 2 sfr at 467, underperforming the market, while SGS was the only decliner, closing down 6 sfr at 1,534.

Into Scandinavia now and starting with Sweden where in Stockholm shares closed slightly higher, supported by weaker-than-expected US economic data which eased fears over inflation, and higher interest rates.

The OMX Stockholm index closed up 0.62% at 417.23 points, while the OMX Stockholm 30 index ended 0.65% higher at 1,276.02 points. Turnover amounted to 27.80  Billion skr.

The main sector movers were materials, which closed up 1.54%; telecommunication services, down 0.83%; and industrials, 0.96% higher.

The major movers within these sectors included SSAB A, up 2.39% at 257 skr; Tele2 B, down 1.50% at 115; and Atlas Copco A, up 3.30% at 117.25.

Ericsson B closed up 0.68% at 26.48. Standard & Poor's raised Ericsson's corporate credit ratings to 'BBB+/A-2' from 'BBB-/A-3' after a review of the company's operating performance and medium-term trading prospects.

Volvo B was up 0.52% at 144. Volvo said it will invest slightly more than 1.7  Billion skr 2007-2009 to increase manufacturing capacity for heavy diesel engines by 20%, and capacity for heavy gearboxes by 50%.

Volvo said it is making the investment partly as a result of increased demand for its products in emerging markets such as Eastern Europe and Asia.

Swedish Match closed up 0.19% at 129. Swedish Match said it has has agreed to purchase Bogaert Cigars, a privately held cigar company headquartered in Belgium, for an undisclosed sum.

Bogaert has an annual sales of approximately 20  Million Eur, and approximately 600 employees. Yearly production volumes are currently some 270  Million cigars.

Electrolux B closed down 1.45% at 169.50. CEO Hans Straaberg, said the launch of the company's new product programme for Europe has been delayed, and that consequently Electrolux now expects higher costs and delayed sales up until the time the launch is completed.

Into Norway now and in Oslo Share prices closed higher, led up by oil producers on firm crude oil prices and by Renewable Energy Corporation, with the market supported by positive sentiment from US markets after the US core personal consumption price index rose a lower-than-expected 0.1%.

The OSEBX Benchmark index closed 9.29 points higher at 504.79 and the OSEAX All Share index rose 11.01 points to 577.55.

Total turnover amounted to 13.27  Billion nkr.

Statoil closed 5.5 nkr higher at 175.75 and DNO added 0.09 to 11.69 as oil producer stocks moved higher on the firm crude oil prices.

Norsk Hydro was up 6.5 at 224.5, also rising on the strong crude oil prices.

Petroleum Geo-Services added 6.75 to 162.75. Moody's Investors Service has upgraded the group's corporate rating to Ba2 from Ba3, and assigned a Ba2 to the firm's proposed 800  Million usd of senior secured credit facilities.

Seadrill rose 3.75 to 129.25 on broker expectations that the Norwegian offshore services firm could be in the running for new short-term rig contracts in the North Sea, dealers said.

Frontline added 4 to 276.5 and Subsea 7 rose 1.75 to 127.5.

Renewable Energy was up 9 at 212 after Germany's Q-Cells yesterday said the current shortage of silicon, needed to make solar cells, is now likely to last until the end of 2008 or early 2009.

Yara International added 0.75 to 179.

Orkla rose 1.75 to 107 and MediCult was 1.4 higher at 20.4. Orkla has acquired a 9.77% stake in Norwegian reproductive technology firm MediCult for a total of 44.55  Million nkr.

Schibsted fell 4 to 288.

Telenor added 2.5 to 116.25. The group's Thai division, Total Access Communications, can save 1  Million nkr per year under new market regulations in the country, daily Finansavisen said.

Opera Software gained 1.7 to 14.6 after it announced that it has been selected by Sony Ericsson for its new top of the line W960i mobile walkman phone

Tandberg was up 5.75 at 132.5 and Fast Search & Transfer rose 0.35 to 13.6.

Among other stocks traded Friday, Aker Kvaerner added 3 to 148.5, Aker Yards rose 0.5 to 101.5, Tomra Systems was 1.8 higher at 54.5, Storebrand added 1.9 to 93 and DnB NOR was up 0.4 at 79.4.

In Finland we saw Helsinki shares close higher led by Nokia, with M-real outperforming the broader market after it was initiated with 'overweight' recommendations in a Morgan Stanley paper sector note.

The OMX Helsinki 25 closed up 1.40% at 3,317.83 and the OMX Helsinki all-share index ended 1.23% higher at 11,629.54 on 1.925  Billion Eur turnover.

Nokia -- up 1.87% to 21.78 Eur -- continued its recent set of gains to lead the broader market into the black.

Among paper stocks, M-real B ended 3.28% stronger at 5.04 Eur after it has been initiated with 'overweight' recommendations in a Morgan Stanley paper sector note, in which the broker started coverage of the sector with an 'in-line' stance.

The broker started UPM-Kymmene and Stora Enso with 'equal-weight' recommendations.

UPM-Kymmene finished 1.80% firmer at 19.20 Eur, while Stora Enso R was 1.85% higher at 14.31 Eur.

Of the industrial shares, Metso  was 2.04% firmer at 44.45 Eur, Outokumpu added 2.15% at 26.10 Eur and Wartsila B gained 2.87% at 49.51 Eur.

Wartsila said it has Won a turnkey contract for the second phase of a power plant from Saudi Arabia's National Agricultural Development Company (NADEC), but gave no financial details.

Energy stocks closed higher, with Fortum adding 0.51% at 23.74 Eur and Neste Oil advancing 1.28% to 28.49 Eur.

Elsewhere, TietoEnator ended 0.78% higher at 23.20 Eur.

The IT company said it has Won a five-year contract to supply IT infrastructure services to Finnish purchasing and logistics company Tuko Logistics Oy, but gave no financial details.

And rounding out Scandinavia this week we finish with Denmark where in Copenhagen Share prices closed higher, led up by the AP Moller-Maersk stocks and Genmab as investors readied themselves for the new OMXC20 index on Monday.

The OMXC20 index closed 2.70 points higher at 488.05 and the OMXCB Benchmark index added 3.40 points to 471.43.

The OMXC All Share index closed 4.20 points higher at 478.38 on turnover of 5.76  Billion dkr.

AP Moller-Maersk B closed 1,900 dkr higher at 67,400 and the A-shares rose 2,400 to 66,400, lifted by a report in Trade Winds that the group has finalized the sale of two tankers to Libyan interests for 48  Million usd. The company would not comment on the report.

Dansk Supermarket, whose majority owner is AP Moller Maersk, aims for expansion outside of Denmark in coming years, daily Jyllands-Posten said.

DS Torm shed 1 to 209, while DSV added 1.5 to 109.75

Genmab was up 13 at 398. The group said a phase 2 trial shows that its drug Ofatumumab, also known as HuMax-CD20, is successful in treating rheumatoid arthritis. Ofatumumab is co-developed under a worldwide agreement between Genmab and GlaxoSmithKline.

Novo Nordisk B fell 4 to 572. The group has started a phase 1 clinical trial of GlycoPEGylated factor VIIa, a long-acting version of its NovoSeven Coagulation Factor VIIa (recombinant), which is used in the treatment of bleeding episodes.

Lundbeck was 2.25 higher at 136.75, while Coloplast shed 3 to 456.5.

Danisco added 0.5 to 459. Analysts polled by RB-Boersen see the group posting full-year EBIT of 2.157  Billion dkr on Wednesday, up from 2.372  Billion a year ago. Net profit is expected to be 1.021 bkn dkr, up from 622  Million dkr, on sales of 20.52  Billion dkr, compared with 20.91  Billion.

Carlsberg B rose 4 to 657, while Novozymes fell 1 to 596.

Vestas Wind Systems added 3 to 389. The stock was supported by speculation that a new US energy bill will require electricity utilities to have at least 15% renewable energy sources in their production and by a report from RB-Boersen that the group has started construction of its first US-based factory, with production expected to commence in 2008.

GN Store Nord was 0.5 higher at 63 after the stock was upgraded to 'overweight' from 'neutral' at Sydbank. The bank expects the pending case regarding the group's blocked sale of hearing aid business Resound to Phonak to be resolved soon.

Elsewhere, William Demant Holding closed the session 3 higher at 566, Danske Bank was 0.25 higher at 230.25, Topdanmark added 17 to 994, TrygVesta was up 0.5 at 451.5 and FLSmidth rose 3 to 432.5.

Heading South now and starting in Spain where Share prices closed sharply higher in heavy trade with Repsol YPF outperforming.

The IBEX-35 index ended up 173.7 points or 1.15% at 15,252.1, after trading in a range of 15,110-15,288, on a turnover of 12.267  Billion Eur.

Repsol YPF outperformed, surging 1.11 Eur or 4.01% to 28.76, with dealers citing technical factors after breaking out of a key resistance level.

Other heavy-weights were firm, with Telefonica (nyse: TEF - news - people ) up 0.20 at 16.76, BBVA gaining 0.27 to 18.59, and Santander adding 0.05 to 14.0.

Extending yesterday's gains, Sogecable climbed 0.75 or 2.51% to 30.65 on hopes for deals for its pay-TV businesses with broadband operators such as Telefonica ahead of the possible future sale of the pay-TV arms.

Constructors benefited from the easing rate concerns, with Sacyr gaining 1.11 or 2.89% to 39.53, Acciona up 3.95 or 1.94% at 207.35 and ACS 0.72 higher at 48.94.

Abertis added 0.38 to 23.97, after the Italian government was reported to have modified rules on motorway tariffs decided in January, which will apply for existing and new concessions.

'This is a sign that the Italian government is moving forward on outdated concessionary regulation, and places Abertis in focus on hopes that the merger with Atlantia (formerly called Autostrade SpA) will go ahead,' the trader said.

Indra rose 0.34 to 18.28, after UBS (nyse: UBS - news - people ) upgraded the stock to 'buy' from 'neutral' with a price target hike to 21.6 Eur per share from 19.8.

Among the session's handful of losers, Altadis shed 0.13 to 49.70, Endesa (nyse: ELE - news - people ) gave up 0.14 to 39.97 and Sabadell slipped 0.02 to 8.28.

To neighbours Italy where Share prices ended higher for a third straight day, with Bulgari leading the advance following an upgrade by HSBC.

The Mibtel index closed up 1.04% at 33,599 and the S&P/Mib rose 1.18% to 43,099, while volumes rose to 9.88  Billion Eur from 6.82  Billion yesterday.

Gainers outnumbered decliners 246 to 91, while six shares ended flat.

On Monday, seven companies going ex-dividend will knock 0.746%age points off the S&P/Mib blue chip index, Standard & Poor's said.

And rounding out Europe this week we go to Greece where in Athens Greek shares closed higher, bolstered by positive international bourse sentiment, but the Greek Postal Savings Bank closed down.

The ASE general index ended 0.8% higher at 4,900.5 while blue chips gained 0.9% to close at 2,606.2. Mid caps and small caps ended 0.4% higher at 6,303.3 and 1,152.8, respectively.

Advancers outnumbered decliners 175 to 71 while 67 were unchanged in average trade of roughly 359  Million Eur.

Greek Postal Savings Bank led blue chip decliners and fell 1.7% to 17.1 Eur, after recently outperforming and weighed by its initiation at broker Citigroup who gave it a hold rating and target price of 17 Eur.

National Bank of Greece jumped 1.4% to 41.8 Eur, recovering from recent selling pressure, and Alpha Bank ended 1.3% higher at 23.4 Eur. Sources told Thomson Financial News that the two have offered a loan, roughly 200-230  Million Eur, to the Albanian government for a road-works project.

EFG Eurobank ended 0.4% higher at 26.2 Eur, partially off its gains from earlier in the session. Its unit Eurobank Properties announced that it has bought a property in northern Athens for a price of 24  Million Eur, which is designated for office space.

Hellenic Telecoms (OTE) edged 0.3 higher to 23 Eur. The Minister of Finance said at a press conference yesterday that OTEs placement will proceed as planed. Meanwhile, unconfirmed press reports said that the Greek State will propose to continue OTEs current CEOs term at its upcoming AGM.

UK Market - Lonmin led the way as the FTSE 100 powered to its highest close in almost seven years on Friday.

Shares in the platinum mining group topped the blue-chip leaderboard, climbing 4.8% to a record high of £41.69 after Morgan Stanley increased its target price to an ultra-bullish £50.75.

The upgrade was based on new platinum price forecasts. The broker told its clients that spot platinum could rise above $1,500 per troy ounce this year and as high as $1,800-$2,000 on an 18-month view. It said there were three specific catalysts that could drive the metal to these levels.

The first was the possibility of strikes at the two leading South African platinum producers – Anglo Platinum and Impala Platinum – once labour contracts ended at the end of the month. The second was the recent launch of an exchange-traded platinum fund, and the third was a recovery in bridal jewellery demand in China.

In the wider market, reassuring inflation news from the US helped the FTSE 100 advance 82.5 points, or 1.2%, to 6,732.4 – its highest finish since September 5 2000. Over the week, the blue chip index gained 227.3 points, or 3.5% – its best weekly performance since July 2006. It now lies fewer than 200 points from its record closing high of 6,930.2, recorded on December 30 1999.

Elsewhere, the FTSE 250 rose 190.4 points, or 1.6%, to 11,999.6 with Carpetright, up 30.6% to £13.40, the top performer after confirming speculation that it had received a buy-out proposal from its chairman and 23.3% shareholder, Lord Harris of Peckham.

J Sainsbury was the day’s main talking point, however. Shares in the supermarket operator rose 4.4% to a record high of 590p after Qatar’s royal family increased its holding to 25% after buying 123m shares at 595p each. Traders believe the Qataris will use their stake to put pressure on Sainsbury to spin off its property assets into a real estate investment trust.

In the same sector, Wm Morrison rose 2.6% to 308.5p. Morrison has a bigger property portfolio than Sainsbury. As such, many analysts believe it could be a takeover target for a buy-out group.

Wolseley, the plumbing and building materials group, added 4.6% to £13.28 as traders took the view that it could be a take-over target for a private equity group. These hopes were based on reports that two buy-out firms had lodged $10bn offers for the supply business of Home Depot, a key rival of Wolseley in the US. Analysts said the $10bn price tag made Wolseley look cheap.

Standard Life, up 1.5% to 348¾p, lagged several of its peers in the insurance sector. Panmure Gordon pointed out that former policyholders would receive their bonus shares (one for every 20 held) on July 10. Panmure said many investors were likely to sell and this could put downward pressure of the Standard Life share price.

Not everything was going up Friday. Sugar producer Tate & Lyle drifted 0.3% lower to 582½p after Morgan Stanley downgraded to “underweight” and cut its target price to 520p.

Drax Group shed 1.4% to 763½p after Goldman Sachs removed the operator of Europe’s biggest coal-fired power station from its “buy” list, citing higher C02 emission costs.

Among the mid-caps, Ladbrokes bounced back from early weakness to close 1.5% higher at 459¾p as private equity bid rumours refused to die down.

Property group Helical Bar added 7.8% to 468½p on vague stake building rumours.

Tullow Oil moved up 3.5% to 409p amid talk that a positive report from one of its prospects in Uganda could be in the pipeline.

Japan & Asia Pacific - Asian stocks extended earlier gains on Friday as energy companies such as INPEX tracked a spike in oil, while Japanese government bonds rose after the central bank left interest rates on hold.

In Japan , The Nikkei average rose 0.72% on Friday to close at its highest level in a week as air conditioner maker Daikin Industries Ltd. rose on expectations of a hot summer this year, while a softer Yen helped exporters such as Honda Motor Co. Ltd.

Isuzu Motors Ltd. rose 2.5% to 645 Yen after a media report that Toyota Motor Corp. would outsource production of diesel engines to Isuzu, while Yahoo Japan Corp. gained 3.8% to 43,350 Yen on its tie-up with Apple Inc. for music download services.

The cheap Yen is the most positive factor for the stock market. It's a boost for the Japanese economy. The Nikkei average is like the index for exporters.

The Nikkei (.N225: Quote, Profile, Research) gained 129.20 points to 17,971.49, a tad short of 18,000 but the highest close since 7 June. On the week, the Nikkei lost 1%. The broader TOPIX index rose 0.93% to 1,772.94.

Worries about imminent rate hikes have weighed on the stock market recently and the Bank of Japan Governor Toshihiko Fukui's remarks after the close suggested there wouldn't be any rate hike in July.

Fukui said the central bank needed to keep an eye on recent rises in long-term rates and how they could affect Japan's economic and price outlook. He also said he wants to be more convinced of the sustainability of domestic capital spending and consumption.

In Hong Kong Share prices hit a new closing record as China stocks, notably financial, telecom and oil counters, got a big boost from continued shift of funds from the mainland by some investors.

Turnover was heavy, with dealers attributing a significant portion of it to China's expanded qualified domestic institutional investor (QDII) program which allows mainland investors to buy H-shares in Hong Kong. The Hang Seng Index closed up 149.79 points or 0.72% at 21,017.05, after moving in the range of 20,917.64 and 21,052.95. For the week, the index is up 507.9 points or 2.48%.

The index's previous closing high was 20,994.61, hit on May 17 this year.

Turnover Friday was 83.36  Billion hkd.

The Hang Seng China Enterprises Index was up 262.99 points or 2.35% at 11,443.91.

To China now where A-shares in Shanghai and Shenzhen rose, supported by gains in large cap banks with the sector drawing interest after China Construction Bank announced it planned to issue up to 9  Billion A-shares in its Shanghai IPO.

Declines in other counters, such as steel makers, on expectations for a further hike in interest rates in the near term, however, curbed the price gains.

The benchmark Shanghai Composite Index, which covers both A- and B-shares listed on the Shanghai Stock Exchange, closed up 17.66 points, or 0.43%, at 4,132.87, after moving between 4,067.36 and 4,152.54.

Turnover fell to 152.00  Billion yuan, from 185.91  Billion yuan in the previous session.

The markets were sent higher mainly because of a rebound in the banking sector, though the light trading volume suggest these price gains are unlikely long.

Be warned though that with a possible interest rate hike on the cards in the near term, the market is likely to consolidate next week, with players nervously awaiting to see how the government will respond to fresh data showing the economy still running red hot.

Statistics Bureau data Friday showed urban fixed-asset investment rose 25.9% year-on-year in the first five months of the year, a slipper faster clip than in the four months to April.

The data follows a warning from Premier Wen Jiabao on Wednesay when he indicated the government stands ready to consider tighter monetary policy if the overheating continues.

News of Hong Kong-listed China Construction Bank's Shanghai IPO plans gave the financial sector a boost.

Shanghai Pudong Development Bank Co Ltd (SHA 600000) rose 1.72 yuan or 5.03% to 35.91, while Industrial Bank Co Ltd (SHA 601166) gained 1.95 yuan or 6.58% to 31.59.

Huaxia Bank Co Ltd (SHA 600015) advanced 0.36 yuan or 2.91% to 12.75.

Electric home appliance producers were active amid merger and acquisitions talk, sparked by a Shanghai Securities News report that Microsoft may buy a stake in Sichuan Changhong Electric Co Ltd (SHA 600839). Trading of shares in Changhong was supended today.

GD Midea Holding Co Ltd (SZA 000527) surged 3.59 yuan or 10% limit to 39.47 after the Ministry of Commerce agreed it could sell 75.60  Million of its A-shares to Goldman Sachs.

Hisense Electric Co Ltd (SHA 600060) rose 0.30 yuan or 2.36% to 12.99, while Guoguang Electric Co Ltd (SZA 002045) added 0.63 yuan or 4.12% to 15.93.

Steel makers were hard hit on oversupply concerns which have led to downward pressure on prices recently.

In South Korea Share prices closed at another record high, with investors encouraged by easing tensions between the US and North Korea following settlement of a stand-off over frozen North Korean assets.

After several months of haggling, the dispute over frozen North Korean funds in Macau -- which has held up a nuclear disarmament deal -- has ended with the funds being released for Pyongyang, according to a report.

The KOSPI index closed up 3.08 points or 0.17% at 1,772.26, off a low of 1,764.52 and a high of 1,776.80. The benchmark index gained 44.98 points for this week, rising for a fifteenth straight week, its longest run.

Rises outpaced falls by 482 to 300, with 61 shares unchanged.

Institutions were net sellers of shares worth 225.2  Billion Won while foreign and retail investors were net buyers of 66.9  Billion and 108.6  Billion in shares, respectively.

Telecom stocks outperformed the market, with investors attracted by their low valuations and positive earnings outlook for coming quarters. SK Telecom jumped 5,000 Won or 2.46% to 208,000 and KTF rallied 900 or 3.14% to 29,600.

Broadband service provider LG Dacom closed limit-up 3,400 at 26,100 on market rumors that LG Group may acquire Hanaro Telecom. KT, however, lost 300 to 46,150.

Brokerages rallied on hopes that the stock market will stay bullish. The expected enactment of the Capital Market Consolidation Act and strong earnings outlooks also underpinned the rise. Samsung Securities jumped 3,600 or 5% to 75,500 and Woori Investment & Securities surged 1,800 or 5.87% to 32,450.

Banks, however, were weaker, with Kookmin Bank down 700 at 86,800, Shinhan down 1,800 at 54,600 and Woori down 350 at 21,350.

Samsung Electronics fell 7,000 to 574,000, with its opening of a new wafer plant in the US failing to impress investors. Hynix also lost 300 to 30,600.

LG Philips LCD slid 1,000 to 44,000 as investors locked in recent solid gains driven by growing hopes that the display maker will turn profitable in the second quarter.

In the Philippines share prices gained 1.18% to reach a new record close on Friday, thanks to the rally on Wall Street where economic data indicated inflation was being kept in check.

The composite index climbed 42.67 points to 3,671.29. Trading hit a record high of 3,693.67 with a low of 3,628.62 points.

The broader all-share index rose 20.58 points or 0.89% to 2,324.79

Gainers outnumbered losers 67 to 49, while 59 stocks ended flat on volume of 7.3 billion shares worth 19.6 billion pesos (420.68 million Dollars).

A key market mover was San Miguel Corp, transactions in which comprised about two-thirds of the day's turnover.

San Miguel A-shares added 50 centavos to close at 67 pesos while its B-shares gained one peso to 73.50.

Philippine Long Distance Telephone Co was up five at 2,705 while conglomerate Ayala Corp rose 35 to 580.

Singaporean shares edged up, boosted by big gains by some blue chips and a strong performance by Wall Street overnight. The Straits Times Index closed up 7.73 points at 3 581.16.

Taiwanese shares hit a seven-year high amid strength in the tech sector. The Weighted Price Index of the Taiwan Stock Exchange rose 122.92 points to close at 8 573.64 - the highest finish since July 17 2000.

Thailand' s shares climbed 1.3% to close at 744.25 in moderate trade, as players took cues from regional gains to buy blue chips.

Indonesian shares gained 0.6% to a fresh record high of 2 120.64 in moderate volume, boosted by hopes of lower interest rates.

Malaysian shares added 0.3% to close at 1 360.65 investors as bargain hunting lifted some heavyweights and positive news flow boosted oil and gas stocks.

In India , the positive trend on the Asian bourses failed to create an impact on the Sensex, which saw a high volatility in the closing hours of trading despite remaining firm in the afternoon.

However, the Sensex closed the day at 14,162.71 points, down 41.01 points or 0.29%. The S&P CNX Nifty closed flat, up by 1.45 points or 0.03% at 4,171.45 points. During the last seven days, the Sensex fluctuated nearly 415 points but closed the week with a modest gain of 99 points.

A volatility of 300 to 400 points may not affect the markets in a major way as the current levels are quite high and, at these figures, one cannot expect the Sensex to go in one direction for long.

While 1,275 stocks (49.59%) gained during the day, 1,210scrips (or 47.06%) headed southwards.

Top gainers on Friday were BHEL, Maruti Udyog, L&T and Tata Motors while Tata Steel, HDFC, NTPC and Grasim industries were the main losers.

In Australia Share prices closed higher led by major resources stocks following gains in commodity prices.

Diminishing concerns about a near-term rate hike in Australia, following remarks by Reserve Bank of Australia governor Glenn Stevens on Thursday, supported the banks and retailers.

The S&P/ASX 200 closed up 32.6 points or 0.52% at 6,293.9, below the day's high of 6,298.5 and above a low of 6,268.0

For the week the benchmark index added 62.1 points or 1.0%.

The All Ordinaries index rose 28.7 points or 0.46% to close at 6,317.1.

BHP Billiton hit a record 34.46 aud before closing up 0.10 or 0.29% at 34.00 while Rio Tinto added 1.50 or 1.56% to 97.40.

In New Zealand The sharemarket ended the week on a firmer note but cautious investors were still eyeing the fortunes of the New Zealand Dollar.

The benchmark NZSX-50 index rose 0.4% or 18.79 points to 4212.45 on light turnover worth $108 million. Rises narrowly outnumbered falls 59 to 57 on 156 stocks traded.

The currency was "the week's story," following the Reserve Bank's intervention.

The NZ Dollar has not changed much despite the Reserve Bank's efforts, but there was a pullback emerging in fully-valued New Zealand stocks.

Auckland Airport jumped 10c to 284 after UBS said the airport was a possible target for Macquarie Airports Group once it sold its stake in Rome's two main airports.

Air NZ climbed 5c to 307, while airport and infrastructure investor Infratil rose 7c to 319, and one of its major investments, Trustpower jumped 25c to 845.

The Warehouse was also in the spotlight, as one of its would-be suitors, Woolworths, said it would appeal a Commerce Commission decision barring its takeover bid.

Given the fact that the commission's reasons are not yet out, Mr Porter thought the move was a definite indication of interest from Woolworths. Warehouse shares rose a cent to 598.

Other moves were mixed, including Contact up 5c to 882, Fletcher Building up a cent to 1271, Fisher & Paykel Appliances up 4c to 369, Pumpkin Patch down a cent to 370 as Fisher Funds lifted its stake by 1% to 11.56%.

Tower continued to edge higher, up 8c to 258, Steel & Tube was up 15c to 455, and Vector rose 7c to 275 as it announced a new acting chief financial officer.

Market leader Telecom ended flat at 462 on light volume worth $12.8 million.

Commodities - Wheat was the star performer in the commodities complex this week, leading strong gains for other grains.

Global wheat stocks are expected to shrink to a 30-year low so any threats to production are having a marked effect on prices. This week, wheat prices in the US and Europe hit their highest levels in more than a decade as drought and floods threatened key producers’ harvests.

In Chicago, July wheat prices surged 11.5% to $6.08 a bushel this week amid fresh concerns about the US winter harvest due to incessant rain. Prices reached an 11-year high of $6.19¼ on Thursday, partly fuelled by short covering – dealers closing positions betting that the price would fall.

Growing ethanol consumption is a key support for corn but high wheat prices also help if farmers switch to corn to meet demand for livestock feed. CBOT July corn jumped 9.4% to $4.18 a bushel this week, helped by a lack of rain in its growing region. July soyabeans added 2.8% to $8.44½ a bushel.

The deteriorating situation in the US has comPounded concerns about global production, with a growing list of key growers reporting problems. Wheat harvests in Ukraine, Australia and China are being stressed by lack of rain and analysts are scaling back forecasts for this year’s EU crop.

Oil prices made strong gains this week, prompted by concerns about the US refining system’s ability to deliver enough petrol supplies during the summer driving season.

ICE July Brent crude rose 11 cents to $71.47 a barrel Friday, up 4.2% over the week. Nymex July West Texas Intermediate added 17 cents at $67.82 a barrel, gaining 4.7% this week.

Technical analysts said this week’s price action could pave the way for a further move higher and speculation is mounting that crude prices could breach record highs hit last August.

Stocks of petrol and heating oil stand well below their long-run averages for this time of year after a second weekly decline in US refinery utilisation shocked analysts.

Nymex July RBOB rose 4.2 cents to $2.2665 a gallon Friday, 6.6% higher this week, while Nymex July heating oil was fractionally weaker at $2.0158 Friday but up 6.2% over the week.

Base metals staged a recovery, led by copper, up 4.9% to $7,510 a tonne. Workers at Grupo Mexico called off strike action but other disputes in Mexico and Chile could affect supplies.

Zinc increased 2.9% to $3,745 a tonne this week amid concerns about declining stocks, while nickel dipped 0.9%, stabilising after a sell-off the previous week.

Platinum traded at $1,278 a troy ounce late in London on Friday, off 0.7% this week. Gold rose 1.3% to $653.80 a troy ounce over the week.

Currencies - Action on the currency markets started with a bang this week as the Reserve Bank of New Zealand intervened on Monday to stem the NZ Dollar’s rise for the first time since the currency was allowed to float freely in 1985.

The RBNZ said it had taken the decision as the NZ Dollar, which had risen to 22-year high against its US counterpart and a 17-year peak against the Yen, was at levels unjustified in terms of economic fundamentals.

The New Zealand Dollar dropped sharply on Monday, sliding more than 2% to a low of $0.7465 against the Dollar and a trough of Y90.90 against the Yen.

However, the kiwi’s descent quickly ran out of steam as it became clear that the RBNZ was not prepared to chase the currency lower. Indeed, analysts questioned the central bank’s actions given that it had raised interest rates, already the highest in the industrialised world, by 25 basis points to 8% the previous week.

High New Zealand interest rates have been the driving force behind the kiwi’s recent climb as rising risk appetite has seen carry trade investors sell low-yielding currencies such as the Yen to fund the purchase of NZ Dollars.

The New Zealand Dollar recovered to stand down 1.2% against the Dollar at $0.7540 but up 0.3% against the Yen at Y93.20 over the week.

Elsewhere, the Yen fell to a 4½-year low against the Dollar, a 15-year trough against the Pound and a fresh record low against the Euro as surging global equity markets boosted risk appetite and demand for carry trades. The Yen fell 1.6% to Y123.60 against the Dollar, 1.9% to Y244.20 against Sterling, 1.3% to Y164.90 against the Euro and 0.8% to Y103.70 against the Australian Dollar on the week.

Comments from Toshihiko Fukui, governor of the Bank of Japan, also weighed on the Yen. The central bank, as widely expected, left interest rates on hold at 0.5% following its monthly policy meeting Fridday. However, Mr Fukui indicated that the central bank was looking for more confirmation about the sustainability of domestic demand before raising interest rates and reiterated that its tightening campaign would be gradual.

His comments damped speculation of an August rate hike, entrenching the Yen’s funding currency status in the carry trade world.

Meanwhile, a widely expected 25 basis point interest rate rise to 2.5% from the Swiss National Bank failed to boost the Swiss franc. The Swissie lost 0.6% to SFr1.6600 against the Euro and 0.7% to SFr1.2440 against the Dollar on the week.

Elsewhere, the Dollar was mixed as the sharp rise in bond yields that has benefited the currency in recent weeks appeared to run out of steam. It rose 0.2% to $1.3350 against the Euro but fell 0.2% to $1.9760 against the Pound on the week.

The Australian Dollar extended a multi-year high against the U.S. Dollar on Friday in New York. The Australian currency gained sharply on the release consumer price index data in the U.S. The Australian Dollar edged higher in the afternoon and got as high as 0.8425.

The South African Rand firmed sharply in late trade Friday. The rand’s strength was underpinned by gains on equity markets which were allowing carry trades to continue. The Rand was bid at 7.1198 per Dollar from its previous close of 7.1835. It was bid at 9.5138 to the Euro from a previous 9.5603 and at 14.0698 against Sterling from 14.1312 before.

Closing out currencies this week we go to the RMB which finished at 7.6254 to the Dollar on the over-the-counter (OTC) market, a new high and up from 7.6430 the previous trading day.

China - China's spending on fixed assets such as roads and power plants accelerated in the first five months of the year, prompting predictions of imminent monetary tightening to slow the world's fourth-largest economy.

Fixed investment in urban areas rose 25.9% from a year earlier, picking up from 25.5% growth in the January-April period, the National Bureau of Statistics said on Friday.

The median forecast of economists' was for a rise of 25.7%, although a government source familiar with the data had said it would be 25.9%.

The report capped a strong set of monthly data. China's trade surplus rose more than 80% in the first five months, industrial output surged 18.1% compared with a year earlier and consumer price inflation quickened to 3.4%. Money and credit growth was also strong.

Premier Wen Jiabao served notice after a meeting of his cabinet on Wednesday that further monetary tightening and investment curbs were on the way.

China traditionally moves interest rates in increments that are divisible by nine.

The People's Bank of China, the central bank, has already raised interest rates twice this year to rein in an economy that is on course to grow by double digits in 2007 for the fifth year in a row.

The Shanghai stock market took the speculation in its stride. The main index recouped early losses to show a gain of 0.67% in afternoon trading.

Companies fund more than half their capital spending from their own resources. But they also have strong incentives to borrow: bank loans cost only around 7% even though the economy is expanding at close to 15% in nominal terms and industrial profits are growing by over 40% a year.

The quality of the investment figures, as with many other Chinese statistics, frustrates market economists. They are nominal, not inflation-adjusted; they include land purchases; and they include sales of second-hand capital equipment.

But analysts said the robust trend was clear enough to be of worry to policy makers who are determined to reduce wasteful investment, especially in sectors that consume a lot of energy and create a lot of pollution.

The details of the report contained both good news and bad news for China's planners.

Investment in non-metal minerals, including cement, leapt 52.6% in the first five months, up from 48.3% in the January-April period, suggesting an unwelcome acceleration in construction in coming months.

The tempo of real estate investment was barely changed in May, up 27.5% in the first five months after a gain of 27.4% in the January-April period.

By contrast, the pace of investment in ferrous metals slowed markedly, hinting at success for the government in its campaign to consolidate the steel industry. Capital spending in non-ferrous metal smelting and processing also slowed.

The fast pace of investment in several non-ferrous metal sectors early this year, such as aluminum, has triggered a series of targeted administrative measures, including strict scrutiny of investment projects and loan applications, which have likely helped curb investment growth in these sectors.

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China's Premier Wen Jiabao signaled the central bank may need to raise interest rates or curb bank lending to prevent the world's fastest-growing major economy from overheating.

Monetary policy needs ``moderate tightening,'' Wen said in a statement on the government's Web site last night after chairing a cabinet meeting. He didn't give a timetable or specify what action the government may take.

Wen is trying to cool the stock market and inflation and prevent excessive factory investment from leading to overcapacity. The benchmark CSI 300 Index of stocks has more than doubled this year amid warnings of a bubble and consumer prices rose in May at the fastest pace in more than two years.

The People's Bank of China raised interest rates twice this year and ordered commercial lenders five times to set aside more money as reserves to limit lending.

The CSI 300 index fell 0.1% as of 11:22 a.m. in Shanghai today.

Industrial production accelerated in May. Output rose 18.1% from a year earlier, the National Bureau of Statistics said today, after gaining 17.4% in April. It was the fastest since 18.5% for January and February, which was combined because of the Lunar New Year.

China still faces ``prominent'' problems in the economy, including ``rapid growth in industrial production and the trade surplus, fast investment growth, excessive liquidity, increasing inflationary pressure and energy conservation challenges,'' Wen said last night.

Monetary policy needs to be ``stable with moderate tightening'' to prevent the economy from overheating, Wen said. The previous official language was ``prudent fiscal and monetary policy,''

The benchmark one-year lending rate is 6.57% and the deposit rate is 3.06%.

The government will also curb lending to ventures that pollute and consume higher amounts of energy as it seeks to avoid overcapacity because of excessive factory investment, Wen said.

Inflation accelerated to 3.4% in May and money- supply growth stayed above the central bank's 2007 target for a fourth month.