US Markets - Wall Street rose moderately Friday, carving out its fourth straight weekly gain amid a fresh round of corporate takeover news.

Talk of a possible merger between Microsoft and Yahoo was the latest in a wave of acquisition activity that has helped drive stocks higher in recent weeks. Activity in the media sector continued to percolate when Reuters Group said on Friday that it had received a preliminary takeover offer from an unnamed suitor.

Less than an hour after the opening bell, Microsoft shares were 1.55% lower at $30.49 while shares of Yahoo had surged 17.8% to $33.19.

Aside from the latest deal talk, the stock market received further evidence that the economy was growing moderately which should help lessen inflation.

Non-farm payrolls rose 88,000 in April, the slowest expansion in monthly jobs in two years. The gains were less than the forecast rise of 100,000 and the 177,000 jobs created in March. The unemployment rate rose to 4.5% from 4.4% while average hourly earnings rose 0.2% in March for a gain of 3.7% over the past year.

The report boosted stock index futures, bond prices erased modest losses and turned positive, while the dollar lost ground.

Not only did we see only 88k jobs created, but the unemployment rate increased from 4.4 to 4.5% as the household survey reported 468k job losses last month.  Based upon the household survey, we have actually seen more job losses than growth since the beginning of the year, which does not paint a picture of a healthy labor market.  People are also working and earning less as average hourly earnings and weekly hours drop.  Taking this into context, we have the risk of a softer retail sales number next Friday - but given the way the market in the US seems to react positive to all/any news, good or bad, it is impossible to predict what will happen to the market.

The Dow Jones industrial average rose 23.24, or 0.18%, to 13,264.62, its fourth straight record close. The Dow also reached a new trading high of 13,284.53.

The blue chip index has set 19 record closes since the start of the year and 41 since the beginning of October.

Broader stock indicators also moved higher Friday. The Standard & Poor's 500 index advanced 3.23, or 0.21%, to 1,505.62. On Thursday, the S&P 500 moved above the 1,500 mark for the first time in nearly seven years, and it rose as high as 1,510.34 Friday. The return to 1,500 puts the closing high of 1,527.46 -- reached March 24, 2000 -- within investors' sights.

The Nasdaq composite index rose 6.69, or 0.26%, to 2,572.15; while the Nasdaq has risen alongside the Dow and the S&P in recent sessions, it remains about halfway toward its March 2000 high.

Friday's advance marked another week of prodigious gains. The Dow is up 1.10% for the week after crossing 13,200 for the first time Wednesday. It gained 7.7% in the previous 25 sessions. The S&P 500 is up 0.77% for the week, while the Nasdaq rose 0.58%.

In earnings news on Friday, Eastman Kodak reported a first-quarter loss and shares in the company plunged 5.5% to $24.55.

Shares in Weyerhaeuser rose 6.9% to $83.52, after the forest-products company swung to a profit in the first quarter and said it was considering strategic alternatives for its containerboard, packaging and recycling business.

Late on Thursday, Starbucks said its fiscal second-quarter profits rose 18%, meeting estimates. The company plans a stock buyback of 25m shares. Its shares fell 2.1% at $30.96.

Economists said the April jobs number would keep Federal Reserve policy on hold and suggested the economy was poised to rebound in the coming months.

In turn, that could raise concerns about higher inflation, an issue that still concerns policy makers at the Federal Reserve.

For now the current state of the US labour market “is ideal from the Fed’s perspective of keeping policy on hold despite concerns that inflation may not moderate,” said Bear Stearns.

The Federal Open Market Committee meets next Wednesday and the federal funds rate of 5.25% is seen remaining unchanged.

Advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where volume came to 1.53 billion shares, down from 1.58 billion on Thursday.

The Russell 2000 index of smaller companies rose 4.01, or 0.48%, to 832.88.

European Markets - Frenetic merger developments during the final two sessions this week led European equity markets to fresh 6½-year highs.

The FTSE Eurofirst 300 rose 0.65% to 1,592.47 Friday, extending the week’s gains to 1.6%.

So, let's look a little closer at Europe and starting this week in Germany where Shares closed higher with TUI on the forefront among gainers on M&A market talk, while the car manufacturing sector performed well, with BMW leading the way on the back of positive broker comments.

The DAX ended 40.07 points or 0.54% higher at 7,516.76, after trading between a low 7,460.02 and 7,526.51 this session.

The MDAX had gained 107.47 points or 1.00% to 10,810.33, while the TecDAX added 5.13 points or 0.59% to 873.92.

DAX futures gained 36.50 or 0.49% to 7,549.50, while bund futures gained 0.29 or 0.26% to 113.79.

BMW finished 1.64 Eur higher or 3.53% at 48.07 after UBS raised its price target to 55 Eur per share from 48 and reiterated its 'buy' rating while JP Morgan reiterated its 'buy' rating and placed BMW's shares on its 'Analyst Focus List'.

DaimlerChrysler gained 1.65 or 2.77% at 61.12, benefiting from a generally positive view on automotive shares at present, dealers said.

Continental was up 2.05 or 1.95% at 107.50. HSBC raised its price target on the stock to 115.50 Eur from 95.60 Eur and reiterated its 'neutral' rating.

TUI was the top performing stock, adding 1.18 or 5.78% at 21.58 on market talk that the Oetker Group and German billionaire siblings Guenter and Daniela Herz are planing a joint bid for the shipping and tourism conglomerate.

Allianz was up 1.40 or 0.86% at 164.51. Allianz SE plans to sell about 3.5  billion Eur of its German real estate this summer in order to reinvest the funds in the international property market, Dirk Grosse-Woerdemann, head of Allianz's property business, told the Financial Times.

Bucking the trend, Altana was the biggest loser, easing 26.76 or 57.47% at 19.80 as its shares traded ex-dividend. The chemicals firm paid out 34.80 Eur per share today, which included a special dividend.

Also trading ex-dividend today are Deutsche Telekom, down 0.65 or 4.85% at 12.74, and E.ON, down 3.05 or 2.66% at 111.75.

Deutsche Boerse eased 3.56 or 2.13% at 163.76. It released first-quarter figures last night that gave an EBITDA lower than analysts' expectations and announced today it would resume a share buyback programme in the second-half of next year.

On the MDAX, Hannover Re lost 1.68 or 4.54% at 35.30 as it traded ex-dividend of 1.60 Eur.

Into France next where in Paris Share prices closed up at another six-and-a-half-year record after a surge in the afternoon fuelled by more gains on Wall Street, where investors reacted to the latest takeover news and corporate results, while also taking a positive spin on employment data for April.

The CAC-40 index finished up 64.55 points or 1.08% at 6,068.83.

Volume for the day was 7.2  billion Eur.

Among CAC-40 stocks, 36 closed higher, 3 closed lower and 1 was unchanged.

On the Matif, May CAC-40 futures were trading up 74.0 or 1.24% at 6,042.0.

On the broader indices, the SBF-80 index closed up 64.55 or 0.88% at 7,428.57 and the SBF-120 ended 45.91 or 1.05% higher at 4,438.08.

Vallourec was one of the major blue-chip risers, adding 10.57 Eur or 5.17% to 214.85. The steel tube maker pleased investors by reporting Thursday night first-quarter results in line with expectations.

Giving detailed quarterly results for the first time, Vallourec said that net profit was 237.7  million, up 11.6% from a year-earlier equivalent of 212.9  million, sales rose 10.3% to 1.454  billion Eur, while gross margin was 29.2%, unchanged from a year earlier.

Arcelor-Mittal, which has been rumoured to be interested in Vallourec, also benefitted from the SSAB-IPSCO deal, climbing 1.88 or 4.72% to 41.69.

The biggest riser on the CAC-40 was Renault, which jumped 5.45 or 5.71% to 100.95, after trading as high as 101.55.

The car maker continued to enjoy a re-rating after recent declines, helped by yesterday's news that Exane BNP Paribas upgraded the stock to 'outperform' from 'neutral'.

Rival car maker Peugeot also made gains on the back of Renault, adding 1.36 or 2.30% to 60.45.

Pernod Ricard shares ended up 2.12 or 1.34% at 159.87, falling back from an earlier high of 161.39 after the group posted an increase in third-quarter sales and broadly confirmed full-year guidance for growth in net profit.

Pernod said sales jumped 6.8% in the third quarter to 1.391  billion Eur, a 12.2% increase on an organic basis. The drinks group said it can 'confirm' guidance of 'around' 20% growth in net profit from ordinary activities, although at the time of the publication of the first-half results the group had simply forecast 20%.

CM-CIC analysts said this was a 'good publication well above the target of 6% (group) organic growth' and that they expect 'growth to continue being driven by key bRands.'

Shares in oil major Total trailed the market, inching up 0.09 or 0.16% to 55.75 as a move to lock in profits, amid high crude prices and after strong results yesterday from Royal Dutch Shell, tempered positive reaction to the French group's first-quarter results that came in above analyst expectations.

Although Total today posted a 17% drop in first-quarter profit to 3.05  billion Eur from a year ago, the result came in above analyst forecasts of 2.9  billion Eur. Sales dipped 3% to 37.04  billion Eur.

EADS, meanwhile, also underperformed the market, rising 0.12 or 0.52% to 23.27 as shareholders met for the troubled aeronautics group's AGM.

On the second line, Thales was one of the rare fallers, shedding 0.39 or 0.86% to 45.03 after the shares were cut to 'hold' from 'buy' at Citigroup, with the broker saying the European defence group looks fully valued.

Publicis Groupe added 0.76 or 2.21% to 35.10, reversing an initial slide after Cheuvreux downgraded the French advertising group to 'underperform' from 'selected list.'

Into The Netherlands now where the AEX closed 3.52 points or 0.66% higher at 539.64, after trading in a range of 536.45-540.77.

Arcelor Mittal led gainers, soaring 4.72% to 41.70 Eur.

Publishing companies made strong gains. Wolters Kluwer added 3.59% to 23.67 Eur while Reed Elsevier added 3.36% to 14.16 Eur, just ahead of the announcement that it is selling its Education unit to Pearson for 950  million usd.

Corporate Express rose 1.92% to 9.55 Eur, rebounding from losses in the previous days, while Vedior put on 1.79% to 19.32 Eur.

Unilever rose 0.69% to 23.19 Eur following a number of upgrades at brokerages after yesterday's earnings.

Oil-related stocks rose as oil futures were up. Royal Dutch Shell put on 1.10% to 26.68 Eur and SBM Offshore added 0.83% to 26.69 Eur.

ABN Amro was up 0.27% to 36.70 Eur amid easing tension following Thursday's court decision to block the sale of LaSalle to Bank of America. Around closing time, a court in New York confirmed that Bank of America had filed a suit against ABN Amro.

Ahold led decliners, shedding 2.53% to 9.63 Eur amid profit-taking after strong gains yesterday.

Among midcap shares, Oce put on 3.47% to 14.91 Eur while ASMI added 2.82% to 19.32 Eur.

USG put on 2.27% to 34.67 Eur and LogicaCMG rose 1.83% to 2.78 Eur.

Among decliners was SNS Reaal, which dropped 0.43% to 18.44 Eur ahead of a trading update on Monday.

Binckbank lost 0.76% to 14.34 Eur, Getronics shed 0.96% to 6.18 Eur and Van der Moolen led decliners, losing 1.40% to 3.52 Eur.

Neighbours Belgium saw Brussels Shares reverse earlier losses to close higher as holding group GBL and brewer InBev rose over 2%.

At the close, the Bel 20 was up 12.74 points or 0.27% at 4719.26.

Amongst the gainers, Groupe Bruxelles Lambert closed up 2.35 Eur or 2.59% at 92.97 Eur. Thursday night, the holding company said its first quarter net profit soared to 69.2  million Eur from 26.0  million recorded last year.

Brewer InBev was a late gainer, closing 1.30 Eur or 2.23% higher at 59.60.

Cofinimmo was up 1.56 Eur or 1.02% at 154.40 Eur, with Dexia Securities upping its rating on the real estate group to 'neutral' from 'hold' on valuation grounds, analysts said.

ING increased its target on the stock to 144.5 Eur from 143.0.

For the financial heavyweights, Fortis was down 0.31 Eur or 0.93% at 32.93 Eur. Dexia rose 0.19 Eur or 0.78% to 24.51 Eur. KBC Group was down 0.34 Eur or 0.34% at 99.00 Eur.

Analysts were bullish on a consortium of banks, including Fortis, being in a position to acquire ABN Amro after an Amsterdam court blocked the Dutch group's 21  billion usd sale of its US LaSalle unit to Bank of America.

In negative territory, Delhaize was down 0.74 Eur or 0.99% at 74.26 Eur. The group presents its first quarter results next week on May 9.

The share rose yesterday over 5.0% as Ahold's sale of its US Foodservice unit to CD&R and KKR for 7.1  billion usd revived expectations of a merger between the two supermarket groups.

Colruyt was lost earlier gains to finish off 0.50 Eur or 0.28% at 177.30 Eur. The discount supermarket group was upgraded to 'overweight' from 'neutral' at JP Morgan.

Utility Suez was down 0.16 Eur or 0.37% at 43.34.

Outside the Bel 20, Tessenderlo was up 2.40 Eur or 5.97% at 42.60 Eur after the chemicals group posted first-quarter results yesterday after the market close which showed a surge in net profit on higher revenues.

In Zurich Swizterland 's share prices closed higher after a quiet trading session, in line with early Wall Street trade and with gains in heavyweight pharma stocks supporting the index.

At the close, the Swiss Market Index was up 62.42 points at 9,455.47, while the Swiss Performance Index closed 49.88 points higher at 7,644.82.

The Euro was down against the Swiss franc, at 1.6459 SFr, while the dollar dropped to 1.2111 SFr.

Pharma heavyweight Roche was among today's sharpest gainers, up 4.30 SFr or 1.9% at 233.00, after receiving EU approval for the use of Herceptin in combination with an aromatase inhibitor for the treatment of breast cancer yesterday.

Peer Novartis closed 0.60 SFr higher at 71.00, while fellow heavyweight Nestle dropped 2.00 SFr to 484.50.

UBS closed up 0.50 SFr at 77.00, recovering some of yesterday's heavy losses after disappointing first quarter results, while rival Credit Suisse was up 0.75 SFr at 94.80. The banking group's retiring chief executive Oswald Gruebel completed his final day as CEO at the AGM today, with Brady Dougan moving onto the executive chair on May 5.

Smaller rival Julius Baer was among the sharpest fallers, down 0.90 SFr or 1% at 84.05.

Other decliners included speciality chemical stocks, as rising oil prices weighed with Syngenta dropping 2.90 SFr or 1.3% to 223.40 and Ciba easing 0.65 SFr to 77.15, still down after yesterday's disappointing first quarter results.

Givaudan closed flat at 1,124 SFr, while peer Clariant was bucking the trend, rising 0.30 SFr or 1.5% to 19.80, ahead of reporting first quarter results on Tuesday.

Outside the SMI, Schindler dropped 0.75 SFr to 78.75. Earlier Schindler said it had bought US elevator service company Sterling Elevator for an undisclosed sum.

Into Scandinavia now and starting this week in Norway where Oslo Share prices closed higher on a firmer oil price, stronger sales guidance from Telenor and DNO, which reported strong progress with a new oil field.

The OSEBX Benchmark index closed 4.6 points higher at 488.0, while the OSEAX All Share index shed 5.7 points to 553.0.

Total turnover amounted to 14.1  billion NKr.

Telenor delighted investors, with its surging share price underpinning the entire market after it issued solid first-quarter numbers and was positive about its future prospects.

Telenor shares closed up 3.9% to 119.50 NKr, valuing the group at 33.5  billion usd. The Norwegian telecoms services index, which Telenor dominates, consequently moved up 25 points to 662.22.

Telenor shares have gained 1.9% since the start the year but have underperformed the rest of the market, whose benchmark index has risen over 10%, due to uncertainties over Telenor's Ukranian unit.

Oil shares rose on a firmer oil price, supported by supply worries concerning continuing political tensions in Nigeria.

Norwegian oil producer Statoil moved up just under 1% to 175.

Desppite poor results from one of its non-oil and gas units, Norsk Hydro firmed 0.5% to 216.25.

Earlier, Hydro announced first-quarter EBITDA fell at petrochemicals unit Kerling, as one-off financial contracts skewed the figures to the downside.

Norsk Hydro has decided to spin off Kerling -- renamed today -- via either a trade sale or a listing on the Oslo Bors. Today, it repeated both remain viable options.

Also among the gainers was DNO, whose shares closed up 1.6% to 11.75 after its latest well at the Sharyoof field in Yemen, in which is has a 24.45% stake, has been brought on-stream at 2,400 barrels per day.

Sharyoof #20 was originally drilled in 2006, but was shut after a short while due to minor problems.

The oil services sector also spouted gains. Subsea 7 closed up 1% to 122.75, Seadrill closed up 1.7% to 105 while SeaBird Exploration was up 3.1% to 32.90.

Norwegian seismic survey group TGS-Nopec Geophysical closed flat at 130, clawing back earlier losses after it said it had been received approval from US authorities for its takeover of US sector rival Parallel Data Systems (PDS) in a cash-and-share deal.

TGS-Nopec, which supplies surveys to the energy industry, will pay 60  million usd in cash and another 12.5  million in shares of the Norwegian group.

Moving against the bulls was fertiliser group Yara International, which reversed midday gains to close 0.7% down to 175.25 after Morgan Stanley repeated its 'underweight' recommendation on the stock and warned rising input costs could pose a real threat to the firm's margins later on this year.

Shipping and maritime services provider Wilhelm Wilhelmsen sank more than 2% after it posted a fall in first-quarter profits at both the pretax and operating levels. The top-line numbers were hit by higher costs and one-off items, which skewed the year-on-year comparison.

In Sweden Stockholm saw the market close slightly higher on bargain hunting, with both Boliden and SSAB rebounding sharply after Thursday's heavy losses for both shares.

The OMX Stockholm index closed up 0.73% at 413.16, while the OMX Stockholm 30 index gained 0.59% to close at 1,264.19. Turnover was 31.35  billion SKr.

The main sector movers were materials, which closed up 3.15%; banks, down 0.58%; and technology hardware & equipment, 1.46% higher.

The major movers within these sectors included SSAB A, up 6.72% at 246 SKr bid; SEB A, 1.46% lower at 237; and Ericsson B, up 1.55% at 26.20.

SSAB A rebounded after yesterday's 6% fall on news it is to buy IPSCO for 7.7  billion usd.

Carnegie reiterated its 'Outperform' rating on the share in the wake of the acquisition news.

SEB closed lower on profit-taking after reporting first quarter results marginally higher than expected.

Nordea closed down 1.40% at 112.70, Swedbank A up 1.78% at 258, and Handelsbanken A unchanged at 203.50.

Boliden closed up 3.37% at 148.50, trading ex-dividend at 4.0 SKr per share. The stock fell 12% yesterday following the company's worse than expected first quarter results.

Hennes & Mauritz B closed down 6 SKr or 1.35% at 439, after trading ex-div 11.50 SKr.

In Finland Helsinki shares were slightly lower, led by Nokia trading ex-dividend, while Wartsila and Finnair gained on the back of their first-quarter reports.

Warstila added 1.87% to 49.65 Eur after the group reported a quarterly pretax profit of 60  million Eur, ahead of the average analyst expectation for 51.1  million Eur, as polled by Kauppalehti/SME.

Among the other leaderboard gainers were Metso, up 0.64% to 40.91 Eur, Kemira GrowHow, up 3.22% to 9.29 Eur, and TeliaSonera, up 1.60% to 5.70 Eur, on bargain-hunting.

Nokia fell 1.80% to 18.54 Eur after going ex-dividend for 0.43 Eur per share, while Neste Oil, which rose sharply yesterday, was down 1.07% to 27.61 Eur.

The biggest faller was Aspocomp, losing 10.96% to 0.65 Eur, after it revealed operating losses widened in the first quarter and said it would remain in the red for 2007.

The printed circuit board manufacturer, which counts Nokia among its biggest customers, also said it may close its unprofitable plant in Salo, Finland, in an effort to save over 10  million Eur a year.

Up to 320 jobs could go as a result of the move, and the closure of Salo would see it take a one-off charge, including write-downs, of up to 20  million Eur.

Elsewhere, Finnair moved 2.47% higher to 12.86 Eur as broadly in-line first-quarter earnings at the group level and positive full-year guidance outweighed concerns about the performance of Finnair's scheduled traffic business.

YIT was up 1.41% to 26.65 Eur. The housebuilder said Friday lunchtime that Schroder Investment Management Compliance Limited had grown its stake in the company to 5.36% as of April 30.

Rounding out the Nordic arena this week is Denmark where in Copenhagen the stockmarkets were closed for a Public Holiday.

Dipping into warmer European climes now and going straight to Greece where in Athens Greek shares ended higher near their intra-day highs, supported by gains on other European bourses amid M&A speculation.

The ASE general index closed 0.5% higher at 4,795.3 with the blue chip index also 0.5% higher at 2,548.6. Mid caps also rose 0.5% to 6,056.6 and small caps gained 0.3% to 947.3.

Advancers outnumbered decliners 140 to 100 while 77 stocks were unchanged in below average trade of roughly 329  million Eur.

Bank of Piraeus ended 1.2% higher at 26.9 Eur ahead of its first quarter results to be released Monday. Its EGM yesterday gave the board the right to proceed with a capital increase of up to 1.3  billion Eur within the next five years

Titan Cement gained 0.7% to 42.8 Eur, after better-than-forecast first quarter results released after yesterday's market close, with strong domestic and South Eastern Europe operations driving earnings growth.

Michaniki spiked 9.2% to 7.12 Eur after broker Citigroup hiked the construction groups target price to 8.3 Eur on its new Russian residential property project.

Intralot slid 0.4% to 22.9 Eur on news that a lottery concession win in South Africa will remain suspended until at least the end of May while the tender process for the contract is reviewed.

Hellenic Exchanges jumped 2.4% to 18.46 ahead of first quarter results to be released Monday.

Neighbours Italy saw the Milan market close higher, supported by strong first quarter results and earnings guidance in Europe, led by Lottomatica and Tenaris.

The Mibtel index closed up 0.65% at 34,090 and the S&P/Mib up 0.66% at 43,973.

Volume was an estimated 7.6  billion Eur.

Lottomatica was up 5.85% to 31.50 Eur after first quarter EBITDA came in above a range of expectations in a Thomson Financial News poll, and with the company upping its full year guidance for EBITDA and sales.

Brokers were mostly positive on Lottomatica, though Citigroup said the strong first quarter and upped guidance was in line with its estimates. The US broker said it is looking for lottery concession wins.

Tenaris rose 2.64% to 17.51 after Vallourec, its French peer, posted strong results and reiterated its full year guidance.

Tenaris reports late this evening with results seen depressed by its Maverick acquisition.

Saipem was down 1.38% to 22.81, continuing to fall after yesterday's Goldman Sachs downgrade to 'sell', from 'neutral', with a 23 Eur target.

Eni was up 0.68% to 25.13.

Italcementi was up 3.16% to 24.84, supported ahead of its first quarter results due Monday to be issued after this evening's board meeting. One broker said Holcim's results earlier this week were another factor.

Buzzi Unicem gained 1.76% to 24.34.

Insurers were mostly higher. Alleanza gained 2.36% to 10.70 and Generali added 0.53% to 34.27 ahead of next week's results.

Among banks, BPVN fell 1.15% to 24.14. Brokers said it is falling on the back of news that Banca Italease's CEO Massimo Faenza is being investigated over his links with businessman Danilo Coppola. BPVN owns 30% of Italease.

BPVN's merger partner Popolare Italiana lost 0.79% to 12.10.

Unicredito rose 01.11% to 7.595.

Capitalia rose 1.03% to 6.995. Brokers said they don't see short-term developments at Capitalia because of the ABN bid battle. ABN holds 9% of Capitalia.

Telecom Italia was down 0.23% to 2.125. Brokers said the stock is subsiding after this week's sale by Pirelli of a controlling stake to investors including Telefonica. The next trigger is Telefonica's synergy plans, one broker said.

Pirelli was up 1.59% to 0.90, reflecting the Telecom Italia sale impact. One broker said Pirelli's prospects have improved, though doubts remain over chairman Marco Tronchetti Provera's strategy.

Enel was up 0.86% to 8.375 after results from Endesa, of which it is taking control. Brokers said the decline in Endesa results was expected.

And rounding out Europe this week, last but not least we go to Spain where in Madrid Share prices closed higher in brisk trade, rebounding from the week's underperformance, with Altadis leading gains and with the focus on heavyweight banks.

The IBEX-35 index closed up 224.7 points at 14,620.3, after trading in a range of 14,426-14,636, on turnover of 10.7  billion Eur.

Altadis lead gains, rising 1.78 Eur or 3.67% to 50.30, after CVC and PAI Partners made an indicative offer for the group of 50 Eur per share.

SCH rose 0.27 or 2.07% to 13.47, while BBVA was 0.38 higher or up 2.14% at 18.10.

Other banks were firm amid vague takeover speculation after Expansion reported a consortium of Andalusian private investors is in talks to invest 15  billion Eur to acquire a Spanish bank.

Bankinter was up 1.15 at 64.60, Popular put on 0.29 or 2.04% to 14.54 and Banesto added 0.19 to 17.80.

Other leading blue chips were higher, with Telefonica rising 0.20 to 16.80 and Repsol YPF, up 0.35 at 24.92.

Endesa underperformed, adding 0.01 to 40.34 after disappointing first-quarter figures, with investors waiting for further newsflow from a conference call.

Other utilities were higher, with Fenosa up 0.39 at 40.70 and Iberdrola adding 0.34 to 37.02.

Property and construction issues rebounded amid bargain hunting after recent losses on negative sentiment in the Spanish property sector, with FCC up 2.00 or 2.94% at 70.00, Sacyr adding 0.95 or 2.44% to 39.90, Metrovacesa gaining 0.70 to 87.10 and Inmobiliaria Colonial rising 0.17 or 4.0% to 4.42. .

Iberia added 0.10 or 2.63% to 3.90, after a failed bid for Australian airline Qantas by an APA consortium, which included Iberia suitor TPG, led to speculation of a more heated effort for control for the Spanish carrier by the US investment fund.

UK Market - Frenzied takeover speculation pushed the FTSE 100 to its highest close since September 2000 Friday and sent the FTSE 250 and All Share indices to record levels.

With takeover approaches for Reuters, up 25.1% to 615¾p, and EMI, 8.2% better at 246¼p, flushed out by 10am and then a €12.8bn private equity bid for Spain’s Altadis, City traders spent most of Friday’s session searching for the next takeover targets.

As a result, many weird and wonderful stories did the rounds.

One involved Icap, the inter-dealer broker. Its shares jumped 4.9% to 535p amid rumours of a bid approach from Deutsche Börse. There was also talk that Michael Spencer, chief executive and founder, had been approached by two suitors to see if he wanted to sell his stake in the group.

Mining stocks were in demand as dealers picked up on a note published by Merrill Lynch on Thursday, which argued that a leveraged buy-out of a mining company was now a possibility. “If the market will not pay for the longer-term assets of mining companies, the private equity groups will,” the broker said.

Merrill tipped Anglo American, up 3.9% to £28.80, and Rio Tinto, 4.6 per stronger at £33.10, as possible LBO targets.

Elsewhere, Friends Provident was marked 4% higher at 199p on talk of a bid from a European rival.

Hanson, which gained 20% on Thursday, put on a further 4.4% to £10.70½p. The rise came amid talk that Germany’s HeidelbergCement would make an offer of at least £11 a share and that this would trigger a bidding war for the UK’s last independent building materials company.

But some analysts thought a battle unlikely as Heidelberg was the only logical trade buyer for Hanson and the only one prepared to take on its asbestos liabilities.

Media stocks enjoyed strong gains after the take-over approaches for Reuters and EMI. Rumours that there could be further deals in the sector saw Pearson, owner of the Financial Times, gain 1.8% to 891p, Reed Elsevier rise 2.8% to 650p and Emap move up 1.2% to 823p.

As the market was closing, Pearson announced that it had agreed to buy Reed’s Harcourt Assessment and Harcourt Education International businesses for $950m.

The bids and rumours combined to send the FTSE 100 up 65.9 points, or 1%, to 6,603.7, a level last reached on September 8 2000.

Only 15 blue chip stocks finished in negative territory. Volume was heavy, with nearly 4bn shares changing hands.

Elsewhere, the FTSE 250 rose 164.7 points, or 1.4%, to a record high of 12,210.8. The FTSE All-Share index added 35.63 points, or 1%, to 3,433.86.

Over the week, the blue-chip index rose 185 points, or 2.9%, while the FTSE 250 gained 307.3 points, or 2.6%.

Friday’s bid rumours were not confined to the FTSE 100. There was also a speculative feel to trading lower down the market.

Tomkins, the automotive and industrial engineer, advanced 13.3% to 302½p as private equity takeover rumours did the rounds again.

Redrow climbed 5.3% to 643p amid talk that it could be a takeover target for Bovis Homes, up 1.1% to £11.53. The chatter was of a 800p approach.

Micro Focus was marked 8.4% higher at 281p after the software group said full-year sales would be ahead of expectations.

First Choice Holidays rose 6.3% to 329p.

Japan & Asia Pacific - Asian markets advanced Friday, with shares in Australia, Indonesia, Malaysia, Singapore and South Korea all hitting record highs, while property stocks gave Hong Kong's bourse a boost.

Investors in Japan and mainland China took the day off for national holidays.

Hong Kong stocks advanced for the third straight session, pushed up by red-hot property shares. The blue chip Hang Seng Index advanced 159.50 points, or 0.8%, to 20,841.08.

Henderson Land rose 6.8% to HK$54.05 after gaining 7% Thursday. The shares were boosted by expectations of a good land auction result next week.

South Korean shares rose to their second straight record, led by gains in heavy industry stocks. The Korea Composite Stock Price Index rose 7.88 points, or 0.5%, to 1,567.74.

The Kospi has hit a series of highs this year amid demand from foreign investors, strong global markets and steady gains in sectors including steel and shipbuilding.

Doosan Heavy Industries & Construction Co. soared 9.6% to 74,000 won on the view its inclusion in the Morgan Stanley Capital International Index means the company is recognized as a global player. The stock was also buoyed on news it received an order worth 473.12 billion won (US$510 million) to build a combined cycle power plant in the United Arab Emirates.

In Thailand , Bangkok shares climbed 0.9% to 716.44 in active trade, amid gains in most Asian bourses.

Indonesian shares rose to a fresh record, led by gains in car distributor Astra and heavy equipment supplier Intraco Penta. The Jakarta Stock Exchange Composite index closed 7.724 points or 0.34% higher to 2,033.368.

Malaysia' s stock index surged to a new record high, led by strong gains in the country's largest mobile phone operator Maxis. The Kuala Lumpur Composite Index of 100 blue chips rose 1.5% to 1,363.40 points.

Philippine shares advanced, lifted by blue chips expected to post solid first-quarter earnings reports. The benchmark 30-company Philippine Stock Exchange Index gained 6.95 points, or 0.2%, at 3,278.48, after losing 0.01% Thursday.

Indian shares ended lower, bucking regional gains, as investors booked profits in index heavyweights Reliance Industries and Bharti Airtel amid high valuations. The Bombay Stock Exchange's 30-stock Sensitive Index, or Sensex, fell 143.94 points, or 1%, to 13,934.27.

Singapore shares rose to a new record, led by a strong first quarter performance by lender DBS that boosted the shares of other blue chips. The benchmark Straits Times Index rose 35.12 points, or 1.0%, to 3,485.76.

Taiwan shares jumped on optimism about strong quarterly earnings. The Weighted Price Index of the Taiwan Stock Exchange rose 133.11 points, or 1.7%, to close at 8,059.77.

The Australian stock market rocketed to fresh highs, buoyed by solid gains from the big miners and an easing in the inflation outlook as judged by the Reserve Bank of Australia.

The benchmark S&P/ASX200 index finished up 59.3 points to a record 6304.9, while the all ordinaries index also gained 59.3 points to 6296.2, also a record close.

At 1618 AEST on the Sydney Futures Exchange, the June share price index contract was 59 points higher at 6318, on a volume of 15,288 contracts.

The world's largest miner, BHP Billiton, picked up 71c to A$30.60, while rival Rio Tinto added A$3.82 to A$86.85. Beach Petroleum jumped nearly 6%, or 7.5c, at A$1.33, while Jubilee Mines added 5.25% or 89c to end at A$17.85.

Earlier, the Reserve Bank of Australia lowered its inflation forecast for the rest of 2007 based on stable oil prices, a higher exchange rate and cheaper bananas. The RBA lowered its forecast for year-end underlying inflation, which excludes volatile price movements, to fall back to 2.5% or below in the next few quarters from 2.75%.

The gold miners also pushed the bourse higher, with the price of spot gold at 1630 AEST in Sydney adding US$5.45 at US$681.10 per fine ounce. Gold miners benefited from the higher price, with Lihir adding 4c to A$3.01 and Newcrest climbing 58c to A$22.98.

Australian miner Bolnisi Gold NL shares fell 1c at A$3.29 after announcing it will merge with CoEur d'Alene Mines Corporation and Palmarejo Silver and Gold Corp in a US$1.1 billion (A$1.34 billion) deal to create the world's leading silver producer.

The banks were mixed, with Commonwealth firming 45c to A$54.30, Westpac picking up 8c to A$27.28 and NAB advancing 12c to A$44.12, but ANZ bucked the trend to give back 1c at A$30.73.

The nation's fifth largest bank, St George, was up 3c at A$36.60 after reporting a more than 14% lift in first-half profit and upgrading its annual earnings outlook earlier this week.

National carrier Qantas was up 1c at A$5.38, with Friday being D-Day for the private equity-led Airline Partners Australia's proposed A$11.1 billion takeover offer for the airline.

The media sector suffered, with News Corp falling 15c at A$28.61, while its non-voting stock fell 20c at A$26.40. This week Rupert Murdoch launched a A$5 billion bid to buy Dow Jones & Co, owner of The Wall Street Journal and other media assets. Mr Murdoch said he would take steps to maintain the Journal's editorial independence and invest in journalism if the bid was approved.

FairFax Media lost 3c at A$5.27 but Publishing & Broadcasting ended 10c firmer at A$20.55.

Telstra gained ended 2c higher at A$4.86, while its instalment receipts were flat at A$3.39.

New Zealand stocks were flat, with a lack of clear trends or drivers leaving large cap stocks mixed. The NZX Top 50 limped to a close for the week, gaining only three points to finish at 4206 on market turnover of $109 million.

Telecom was up one cent to $4.88 after charting an uncertain future at Thursday's results briefing.

Air New Zealand was up 3c to $2.84 after plans were leaked for a low cost domestic airline.

Takeover target Tourism Holdings was up 2c to $2.75, but still below the offer price of $2.80.

Auckland International Airport was up five cents to $2.66, while Contact Energy led the day's losses, slipping 13c to $8.75.

Commodities - Base metals enjoyed strong gains this week in spite of the absence of Asian buyers due to holidays, with copper surging through key resistance levels and nickel and lead reaching new records.

Strike action in Peru also bolstered sentiment this week, although support from miners for the action appeared lukewarm.

Traders hope Chinese buyers returning next week could generate further gains as they cover short positions since prices have moved up significantly in their absence.

Copper jumped 7.2% to $8,300 a tonne this week, helped by London Metal Exchange stocks shrinking to a six-month low at 150,925 tonnes.

Nickel surged 10.6% to $51,550 a tonne this week after hitting a record at $51,600 Friday, with available stocks still critically low at 3,354 tonnes. Further supply tightness seems likely after disruption at the Voisey Bay nickel mine in Canada.

Lead rose 4.3% to $2,107.5 a tonne this week after hitting a record at $2,115 Friday. Ivernia, the Canadian company which supplies about 3% of global lead production, has halted exports from Western Australia due to an investigation into lead poisoning. Peter Fertig at Dresdner Kleinwort said the market was also speculating that demand from China, the world’s largest consumer, would outpace rising inventories.

Zinc played catch-up, gaining 12.6% to $4,140 a tonne. Robin Bhar of UBS says supply/demand fundamentals are tight and any moves to cover the large short positions in the market could push zinc beyond its record $4,600 a tonne.

Base metals strength inspired gains for gold, up 1.1% to $688.50 a troy ounce this week.

Platinum rose 2.7% to $1,321 a troy ounce amid rumours of an imminent US exchange traded fund launch. Prices were also lifted by ongoing industrial action at Northam Platinum in South Africa.

US motorists are likely to face record petrol prices this summer, according to Sam Bodman, US energy secretary. Nymex May/June RBOB gasoline eased 0.9% to $2.2391 a gallon this week, but concerns are mounting that refineries will struggle to keep up with demand after a precipitous fall in petrol inventories over the past 12 weeks.

ICE June Brent slipped 10 cents to $65.95 a barrel Friday, down 3.6% over the week, in choppy trading dominated by violence in Nigeria.

Nymex June West Texas Intermediate fell 52 cents to $62.67 a barrel, retreating 5.8% this week.

Currencies - The Dollar pulled away from a record low against the Euro this week as robust US economic data gave investors little fresh impetus to sell the currency.

The Dollar rallied after the ISM surveys of both the US manufacturing and services sectors came in ahead of forecasts.

Analysts (US based, it has to be pointed out) said the data challenged the market’s pessimistic view of the world’s largest economy after disappointing first-quarter US growth figures released the previous week sent the Dollar tumbling to an all-time low of $1.3680 against the Euro.

This left the foreign exchange market to focus on Friday’s US employment report for further direction. However, the figures sparked little reaction as they came in slightly below expectations. They showed that the US economy added 88,000 jobs outside the agricultural sector in April, just shy of consensus forecasts for a rise of 100,000.

Over the week, the Dollar rose 0.4% to $1.3590 against the Euro, 0.5% to Y120.10 against the Yen and 0.3% to $1.9920 against the pound.

Meanwhile, the Yen came under pressure, falling to a fresh all-time low of Y163.60 against the Euro on Thursday as benign market conditions continued to fuel investor demand for carry trades, in which the purchase of riskier high-yielding assets is funded by selling low-yielding currencies such as the Japanese unit. The Yen eased 0.1% to Y163.20 against the Euro over the week.

The Swiss franc, investors’ second favourite funding currency, also hit a record low against the Euro, dropping to a trough of SFr1.6535 on Tuesday.

However, the Swiss franc recouped some of its losses later in the week after stronger-than-expected consumer price inflation data fuelled expectations for more aggressive monetary tightening from the Swiss National Bank.

Over the week, the Swiss franc fell 0.2% to SFr1.6460 against the Euro and lost 0.6% to SFr1.2110 against the Dollar.

Meanwhile, the Australian Dollar fell 1.1% to a one-month low of $0.8210 against its US counterpart.

A cut in the Reserve Bank of Australia’s 2007 inflation forecast sparked the drop. The central bank said that the Australian Dollar’s strength could add to downward pressure on inflation.

Unless Australian interest rates cuts begin to be priced into the market, the Australian Dollar will continue to be supported on dips by demand from carry trade investors. The market is not pricing in any cuts.

The New Zealand Dollar was buying 73.47 US cents at the close of the week.

Elsewhere, the Canadian Dollar rose 1.1% over the week to a seven-month high of C$1.1040 against the Dollar after strong growth data increased speculation that the Bank of Canada could raise interest rates.

The Rand firmed to a new four-month high against the Dollar on Friday, supported by continuing strong investor appetite for risk and solid metals prices.

At the close Friday, the Rand stood at R6.9405/$, after touching R6.9150 earlier, its strongest level since January 3 according to Reuters data.  It had gained 0.2% on its previous New York close.

The local unit bounced around R7/$ in a wide range during the session, touching R7.02 after central bank governor Tito Mboweni said the currency may need "rebalancing" given the country's huge current account deficit.

The Rand has rebounded from lows in 2006 of R7.98/$ despite the current account shortfall reaching a near-three-decade record of 7.8% of gross domestic product.

China - Shares in PetroChina, the overseas-listed unit of China’s largest energy company, surged on Friday on confirmation of one of the world’s largest oil and gas discoveries of recent times in shallow waters in Bohai Bay near the port city of Tianjin.

PetroChina said that it had confirmed in principle “proven reserves” of oil of 405m tonnes, or about 3bn barrels, and gas of 111m tonnes of oil equivalent.

The total amount of oil and gas in the Jidong Nanpu field, including “probable” and “possible” reserves, was equal to 1,020m tonnes. “The company believes the Jidong Nanpu oilfield is a bulk, quality and efficient oilfield,” it said.

The news pushed PetroChina’s shares up by more than 13% to a high of HK$10.38 in Hong Kong on Friday.

The find provides a welcome boost both to the domestic oil and gas industry and also national resource policy, which is focused primarily on securing as high levels as possible of domestic energy production.

As oil demand and imports have soared in recent years, Chinese domestic production and reserves have increased only modestly, despite extensive exploration efforts. Annual production is now nearing a peak of about 3.7bn barrels a day.

The need for extra stocks of oil has driven Chinese diplomacy in recent years, sending its large state-owned energy groups like PetroChina all over the world, often into hostile environments, in search of new resources.

Meanwhile, there has been a campaign in the US to force major foreign shareholders – including Fidelity Investments and Warren Buffett’s Berkshire Hathaway – to divest from PetroChina because of its ties to the genocide in Sudan.

PetroChina’s parent company, the China National Petroleum Corp, is the largest foreign investor in Sudan’s oil industry. Mr Buffett and Fidelity have so far rebuffed the divestment demands.

Nearly half of PetroChina’s existing output is from Daqing, the company’s traditional base in the north-east of the country. But in recent years, it has become increasing difficult to lift production out of Daqing.

The new field itself is also well situated, in shallow waters near the large northern centres of Beijing and Tianjin, making the cost of extracting and transporting the resource very competitive.

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China Shipping Group, the second biggest oceanic transportation conglomerate in China, plans to build its first shipyard by the end of 2008.

This is the second time in less than two months that a heavyweight centrally-administered state-owned enterprise has branched out into the shipbuilding industry.

The Shanghai-based shipping group spent 3.8 billion yuan taking over the assets and debts of the Jiangdu Shipping Company in east China's Zhejiang Province and renamed the wholly-owned subsidiary China Shipping Industrial Company (Jiangsu).

Ground for the new shipyard -- expected to cover an area of 187 hectares and stretch 3,500 meters along the coastline -- has already been broken in the Yanjiang Development Zone of Jiangdu.

The group's product line mainly involves Panamax Container ships with a deadweight of less than 80,000 tons, including bulk cargo ships and oil tankers, and a variety of floating docks with a lifting strength of no more than 30,000 tons.

The parent China Shipping Group said it would lift the annual production capacity of its shipyard to 1.5 million deadweight tons over a period of three years.

On completion, the shipyard is expected to achieve annual sales revenue of 10 billion yuan and generate a yearly tax revenue for the government of more than 1 billion yuan, it said.

The existing six dockyards of China Shipping Group situated in Shanghai and Guangzhou only engage in ship repairs, ship conversions and hull maintenance.

China Shipping Group, established in 1997, boasts five specialized shipping fleets -- oil tankers, coastal vessels, passenger ships, container vessels and special cargo ships -- making a total of more than 440 vessels with an aggregate deadweight of 15 million tons and an annual traffic volume of over270 million tons.

It is also the holding company of three publicly listed companies, China Shipping Development, China Shipping Container Lines and China Shipping (Hainan) Haisheng which are traded on either the Hong Kong or Shanghai stock markets.

China's is now the world's third largest shipbuilding power after the Republic of Korea and Japan.

The Shanghai Baosteel Group Corp., China's largest steel producer, marched into the shipbuilding industry in March by jointly investing 10 billion yuan with China State Shipbuilding Corporation to build the country's largest shipbuilding base at the estuary of the Yangtze River. (1 US Dollar=7.73 yuan)