European shares edge up; earnings, MidEast eyed

PARIS - European shares ended at a 2-1/2-week high on Wednesday as firm energy stocks and upbeat earnings from companies such as Northern Rock offset a couple of disappointing earnings updates and continuing violence in Lebanon.

By (Reuters)

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Published: Wed 26 Jul 2006, 10:59 PM

Last updated: Sat 4 Apr 2015, 1:09 PM

Sentiment was fragile as investors weighed a mixed set of European and US corporate earnings, renewed concern that the Federal Reserve may raise interest rates further, and oil prices that kept above $74 a barrel despite world diplomats calling for a ceasefire between Israel and Hezbollah guerrillas in Lebanon.

Many investors also stuck to the sidelines before Thursday’s flood of corporate results, hoping companies such as Alcatel, France Telecom, Siemens, Volkswagen, ABB or AstraZeneca will add to the overall positive earnings tone set so far.

The FTSEurofirst 300 index of top European shares added 0.34 percent to close unofficially at 1,319.94 points, its highest closing level since July 10 but still some 6 percent away from a near five-year peak set in early May.

“Investors are really bracing for an avalanche of earnings tomorrow and next week. The hopes are relatively high, and this is why the market is holding up the way it is despite the Middle East being on the verge of a possible regional war,” said a senior dealer at a French brokerage.

However, Wednesday’s results were a disparate batch.

Northern Rock rallied 7.8 percent after the UK mortgage bank raised its profit growth target as it reported a 14-percent jump in first-half underlying profit on a strong housing market.

Swiss-based agrochemicals firm Syngenta rose 5 percent after posting an 8-percent rise in half-year net income, while Reuters

added 5 percent as the news and information group raised its annual revenue growth outlook to between 5 percent and 6 percent on a constant currency basis from a previous forecast of about 5 percent.

On the downside, shares in Peugeot fell more than 10 percent after missing its operating margin target for the first half of 2006 and cutting its second-half outlook.



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