(Updating with full report)
LISBON (Thomson Financial) - Shares closed flat as sharp gains in PT, tracking Spain's Telefonica, offset losses in blue chip EDP, while retailer Jeronimo Martins retreated from a surge earlier in the session to close sharply lower.
The PSI 20 index closed up 0.83 points at 12,815.18 after trading in a range of 12,665-12,815 on volume of around 370 mln eur.
Equities opened lower after losses in international markets overnight and stayed in negative territory throughout the morning, although came off lows around midday.
In the afternoon, shares continued to trade in a tight range in the red, but a rally in the last half-hour brought the index to close flat.
PT surged 0.36 eur or 3.60 pct to 10.35, tracking sharp gains in Telefonica SA after the Spanish operator yesterday said it will bring forward its planned dividend payment of 1 eur per share to 2008 from 2009.
Traders said investors are seeking exposure to PT Multimedia SGPS as M&A talk increases ahead of the cable operator's spin-off, with Vodafone Portugal CEO Antonio Carrapatoso telling Jornal de Negocios that the company could be a bidder for PTM.
PTM was up 0.05 at 10.50, while Sonaecom, another potential bidder for PTM, slipped 0.05 to 3.76.
In the energy sector, EDP shed 0.05 to 4.25. Analysts said that confirmation of the government's sale of up to 5 pct of the company through an exchangeable bond issue was already in the price. Press reports said the government has retained the right to revoke the exchange element of the issue when the bond expires.
Meanwhile, oil and gas group Galp closed flat at 11.47, and electricity grid operator REN fell 0.02 to 3.51.
Banks were weak, with BES 0.08 lower at 16.67, BPI losing 0.03 to 6.27, while BCP slipped 0.03 to 3.21.
Jeronimo Martins fell 0.17 or 3.34 pct to 4.92, off an intra-day high of 5.49, having surged earlier in the day as dealers noted the positive news surrounding the retailer including the upcoming IPO of its Polish Biedronka unit, expectations for great results next week, and news that Ahold is moving on with its divestment plan and could get round to selling its stake in JMar Retail back to the the company.
Builders were also weak after recent gains, with Mota Engil shedding 0.11 or 1.78 pct to 6.07 and small cap Soares da Costa down 0.02 at 2.36. chico.laxmidas@thomson.com scl/ak COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2007 AFX News