European Technology Stock Gain; Volkswagen Falls on Dollar Drop

European technology stocks including Ericsson AB and Cap Gemini SA rose after Hewlett-Packard Co. reported earnings that beat its own forecast as sales of personal computers reached a record.

Companies that are more dependent on the U.S. for sales and profit growth, such as carmakers including Volkswagen AG, fell as the dollar dropped to a record against the euro after U.S. Treasury Secretary John Snow signaled there's no agreement to halt the currency's slide.

The Dow Jones Stoxx 50 Index added less than 0.1 percent to 2773.61 as of 10:22 a.m. in London. The Stoxx 600 climbed less than 0.1 percent. The Euro Stoxx 50 Index, a measure for the 12 countries sharing the euro, rose less than 0.1 percent.

Ericsson, the world's largest maker of wireless equipment rose 0.9 percent to 22.8 kronor. Cap Gemini, Europe's No. 1 computer-services company, added 1.9 percent to 23.12 euros.

``Technology stocks are set to perform better,'' said Tim Bray, a fund manager who helps oversee about $314 million at New Star Asset Management Ltd. in London. ``Newsflow is picking up.''

Hewlett-Packard, the world's second-largest personal- computer maker, said fiscal fourth-quarter net income rose to 37 cents a share as sales of servers rebounded and revenue from personal computers set a record. Excluding certain costs, profit was 41 cents, higher than the company's prediction of as much as 39 cents a share. The stock surged 7.7 percent in Germany.

Royal Philips Electronics NV, Europe's third-largest chipmaker, climbed 1.6 percent to 19.46 euros. The shares led gains on the Stoxx 50.

The dollar fell to $1.3030 per euro, according to electronic foreign-exchange dealing system EBS. That's the lowest since Europe's single currency debuted in 1999.

Volkswagen, Europe's biggest carmaker, fell 1.4 percent to 34.53 euros. The company made about 16 percent of last year's sales in North America. Bayerische Motoren Werke AG, the world's second-largest maker of luxury cars, dropped 0.9 percent to 32.21 euros. It made 28 percent of revenue in North America.


To contact the reporter on this story:
Kotaro Miyata in London at kmiyata2@bloomberg.net.

To contact the editor responsible for this story:
Daniel Tilles at dtilles@bloomberg.net.