Finmeccanica was a leading gainer in European stock markets Thursday as UBS highlighted its exposure to the Boeing 787 Dreamliner.

The Italian aerospace and defence company has a contract to supply parts of the fuselage for the aircraft, which is due to enter service next year. Analysts believe the contract could be worth about €700m a year by 2010.

“Finmeccanica gives the best exposure of any European company to the Boeing 787 programme,” said UBS analyst Colin Crook, raising his stance on the stock from “neutral” to “buy”.

Contract wins with the US, Turkish and Saudi Arabian military should also boost the group’s military division, Mr Crook added. Finmeccanica closed up 3.5 per cent at €23.19.

In the wider market, European indices rebounded following a sharp rally on Wall Street. The pan-European FTSEurofirst 300 rose 20.15 points, or 1.2 per cent, to 1,621.3.

Alstom surged 8.4 per cent to €135.6 as first-quarter figures from the French manufacturer of high-speed trains came in ahead of analysts’ expectations. Citigroup said a 62 per cent rise in orders was 21 per cent ahead of expectations.

Nokia rose 2.9 per cent to €21.56 as a profit warning from US rival Motorola suggested the Finnish group had boosted its share of the mobile handsets market while Swisscom firmed 1.1 per cent to SFr427.75 as UBS said the telecoms group did not deserve to trade at a discount to its peer group and raised its price target from SFr525 to SFr535.

Better-than-expected second quarter figures sent Tandberg, the Norwegian video conferencing group, 5.9 per cent higher to NKr144. SAP firmed 2.3 per cent to €37.46 as dealers built positions in the German software group ahead of its second quarter figures on Thursday.

Takeover target Iberia gained 3.9 per cent to €3.69 as the Spanish carrier agreed to open its books to the consortium led by Texas Pacific Group.

The consortium, which in March made an indicative offer worth €3.60 a share, or €3.5bn, had set Iberia a deadline of the end of this month to respond to its due diligence request. Iberia had hoped to attract rival bidders with the aim of forcing an eventual offer above €4 a share.

Hagemeyer jumped 7.7 per cent to €4.18 amid rumours that Rexel was poised to bid for the Dutch distribution services group. Sources close to the French electrical equipment retailer denied it was planning a takeover.

Infineon rose 3.6 per cent to €13.41 on talk that Hynix Semiconductor of South Korea was eyeing the German group’s Qimonda memory chip division.

Cap Gemini gained 4.7 per cent to €56.21 on speculation it could be a target for Infosys Technologies, the US-listed Indian software group.

After gaining more than 5 per cent on Wednesday, steel tubing group Vallourec rose a further 0.4 per cent to €233 as Cazenove said a bid from Arcelor-Mittal made sense.

“We think that given Arcelor-Mittal’s recent interest in the pipes and tubes sector, coupled with its belief of buoyant medium-term growth, the concept of a takeover is certainly in line with its strategy.

“With few other options left of such scale and potential for synergies, we believe a Mittal takeover of Vallourec is a plausible scenario,” the broker said.

Arcelor-Mittal rose 1.7 per cent to €49.15.

However, Accor, owner of the Novotel hotel chain, eased 1.5 per cent to €71.88 as bid talk faded.

Syngenta lost 1.2 per cent to SFr240.5 following a European Union court ruling banning its herbicide Paraquat.

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