ITALIAN ELECTION RESULTS BOOST SHARE PRICES
Share prices opened sharply higher,
boosted by Italian general election results which dealt a big
blow to the Communist party and bolstered the Christian
Democrats and Socialists.
    The Milan Stock Index was indicated 2.90 pct higher at 0930
GMT as all sectors were stronger. Among stocks posting early
gains at mid morning was Fiat ordinary, which was indicated
13,090 lire against yesterday's closing of 12,705. These are
provisional, not closing prices.
    Analysts said the results from Sunday's and Monday's voting
should boost the bourse in the short-term, but the market's
medium-term prospects remain clouded because of doubt over how
long it will take to form a new government.
    "The result is positive in the sense that the Communists
suffered a defeat and Italians voted for stability," director
Paolo Azzoni at Milan investment bank <ABK Spa>, told Reuters.
    Uncertainty about the election outcome and the possibility
of large Communist gains has been weighing on the bourse in the
last two weeks, brokers said.
    Final returns show the Socialists, led by former Prime
Minister Bettino Craxi, increasing their vote to 14.3 pct from
11.4 in 1983, while the Communists dropped more than three
points to 26.6 pct.
    Support for the Christian Democrats rose to 34.3 pct from
an all-time low of 32.9 in 1983.
    Carlo De Benedetti, chairman of Ing C. Olivetti EC Spa
<OLIV.MI>, commenting on the results last night on Italian
television, said "I am sure the reaction of international
markets will be extremely favourable to the electoral verdict."
    Broker Francesco Dinepi at Milan investment firm <Sige
Spa>, said some U.K. Institutional investors had placed buy
orders in Milan this morning.
    "In the medium-term, the direction of the market depends on
the Christian Democrats and Socialists resolving their
differences," said Dinepi.
     "What Italy wants is another government and quickly," added
Azzoni.
 REUTER
