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Stock markets fell Wednesday as investors took profits on the back of the strong gains the previous day, although most indexes managed to recover lost ground and ended flat.

14 February 2008

MADRID - Stock markets fell Wednesday as investors took profits on the back of the strong gains the previous day, although most indexes managed to recover lost ground and ended flat.

The Ibex 35 began the session falling as much as 1.2 percent before rebounding up as much as 0.66 percent and closing with a modest advance of 0.09 percent. The gains in most shares were not supported by Telefónica, one of the weightiest stocks on the index, which bucked the trend throughout the session and ended 1.78 percent lower.

Small and medium stocks, free of the pressures from maturing futures contracts on Friday, performed considerably better, with the Ibex Medium Cap up 0.40 percent and the smalls putting on 1.01 percent. Market turnover declined to EUR 4.46 billion, of which EUR 4.12 billion came from open operations.

The surprise of the day came from the United States, where data on January retail sales showed an unexpected increase of 0.3 percent after a fall of 0.4 percent in December. The New York market welcomed the positive figures, and mid-session the Dow Jones was climbing 1.25 percent.

In the view of many analysts, the recovery in retail sales in the US may be a first reflection of the impact of the Fed's series of interest rate cuts, which take months to filter through to the real economy. That suspicion was given added weight by the data, which showed that one of the biggest gainers among items purchased was cars, sales of which rose 0.6 percent, the fastest increase since September.

On the other side of the Atlantic, the indicators were somewhat gloomier, with industrial production down 0.2 percent in the euro zone in December.

[Copyright EL PAÍS / RAFAEL VIDAL 2008]

Subject: Spanish news

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