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Italian shares surge in late trade

Milan:Italian shares surge in late trade after the city of Genoa says year-on-year inflation in August was 5.5 percent. Istat tomorrow issues provisional CPI data, with Genoa one of the contributing cities. Inflation in July was 5.6 percent and analysts have forecast a similar figure for August.

Mibtel index closes up 1.61 percent to 10,688, bluechip Mib30 index up 1.17 percent to 15,895.

"A massive amount of paper was traded in the last hour on the back of the Genoa news," said a dealer at a major bank.

Dealers said the market would climb further on Tuesday if the Genoa figure was confirmed across Italy.

Dealers said the strong opening of Wall Street had also given Milan a boost, with volumes up on Friday's level.

Credito Italiano CRDI.MIjumped 4.3 percent to 2,185 lire as hopes grow the bank will produce better-than-expected first half results next month.

"This would be particularly positive, showing the bank can make a big acquisition like that of Credito Romagnolo and still post strong results," a dealer said.

Banca Commerciale Italiana BCMI.MIalso outperformed, up 2.5 percent. "Banks in general should show better results in 1995 because of the recent bond rally," a trader said.

Ferruzzi FERF.MI, Montedison MNT.MI, Snia SIAI.MI and Gemina GEMI.MIpower ahead, hiked by rumours of inter- company mergers, rising 5.2 percent, 3.0 percent, 3.4 percent and 4.2 percent respectively. All see strong turnover.

"The rumours are saying Gemina will merge with Montedison which in turn will fuse with parent company Ferruzzi. Beforehand though Gemina will merge with Snia to increase the size of its weighting prior to the Montedison move," one trader said.

"It sounds very convoluted," commented another.

Telecom Italia TELI.MIand Stet STEI.MIalso shine, up 2.9 percent and 2.2 percent respectively.

Telecom Italia Mobile TIM.MI's recent rally finally ran out of puff, the stock slipping 0.22 percent to 2,298 lire. "There's been some profit-taking there as well as a switch back into the fixed line company and parent," a broker said.

Volumes totalled 567.9 billion lire with the BCI index closing at 664.16. "The 200 daily rolling average charts point to 680 as our next upside target," the head trader at a Milan-based bank said.-Reuter