European shares edge higher on encouraging earnings

Business & Markets 2013
Written by Reuters
Thursday, 31 October 2013 20:47
A + A - Reset
(31/10/13 20:39:51)
* FTSEurofirst 300 index gains 0.3 percent
* Autos, financial gain on encouraging earnings
* Royal Dutch Shell drops after results
LONDON (Oct 31): European shares edged higher, to trade near a five-year
high by midday trading on Thursday, with automobile and financial sectors
advancing after some encouraging company results.
The European automobile index climbed 1.5 percent — the top sectoral gainer,
led by a 5.8 percent jump in Finnish tyre maker Nokian Renkaat, after it
reported better-than predicted operating profit.
The market also got support from a 1.2 percent gain in the banking sector, with
Spain's Banco Popular rising 6.9 percent, after posting better-than-expected
nine-month earnings, thanks to trading and capital gains.
Earnings results were mixed on Thursday, with oil major Royal Dutch Shell's
third quarter profits undershooting analysts' forecasts and pushing its shares,
4.5 percent lower.
"The earnings that are coming through are weak, but stable. The broader
environment is much more supportive of equity prices," said Oliver Wallin,
investment director at Octopus Investments.
"The amount of liquidity in the markets and the capacity in Europe and Japan to
inject further, is generally positive for the market."
At 1226 GMT, the pan-European FTSEurofirst 300 index was up 0.3 percent at 1,291.43 points, after climbing to a five-year high in the
previous session. However, the index remained on track, to record a second straight month of gains.
However, the oil services firm Technip fell 9 percent — the top decliner on the FTSEeurofirst — after cutting its full-year sales and margin
targets for its sub-sea business.
Investors brushed aside concerns that the Federal Reserve's less-dovish-than-expected statement on Wednesday, could mean that the
U.S. central bank might start trimming its stimulus, sooner than foreseen.
The Fed kept its massive stimulus plan intact, as the market widely expected, but did not sound as alarmed about the state of the economy
as anticipated, removing a reference to tighter financial conditions from its announcement.