MW: European shares nudge higher as banks, miners gain
Philips Electronics swings to profit, Ericsson shares lower
By Sarah Turner, MarketWatch
LONDON (MarketWatch) -- European shares pulled back from early losses on Monday to trade with mild gains, as banks and miners advanced and as investors welcomed earnings from Philips Electronics.
The pan-European Dow Jones Stoxx 600 index (ST:SXXP 250.63, +0.72, +0.29%) traded up 0.3% to 250.56, rising off a intra-day low of 248.09.
Banks and miners were the best performers in percentage terms, with shares of Credit Agricole (FR:ACA 12.21, +0.35, +2.95%) up 2.5% and shares of Anglo American (UK:AAL 2,559, +53.00, +2.12%) up 1.3%.
Both sectors fell sharply last week, pressuring the Stoxx 600 index to a loss of 2.6%, as investors worried about possible implications of a regulatory crackdown on the banking sector and tightening of Chinese policy.
Equity strategists at UniCredit said that they expect investors will focus on the improvement in the economic outlook rather than "the only gradually increasing strains resulting from the monetary tightening."
"On balance, we think the positive factors dominate at the moment. In the coming months, we expect a continuation of the uptrend on the equity market," they added.
The U.K. FTSE 100 index (UK:UKX 5,328, +24.68, +0.47%) rose 0.4% to 5,324.24, the French CAC-40 index (FR:PX1 3,829, +8.19, +0.21%) rose 0.1% to 3,824.96 while the German DAX index (DX:DAX 5,691, -4.64, -0.08%) lost 0.2% to 5,685.06.
Asian shares were lower while U.S. stock futures were pointing to a bit of a rebound on Wall Street after sharp losses on Friday. See Indications.
"The focus has shifted to revenues for the latest U.S. reporting season. So far, it is fair to say that revenue has neither excited nor disappointed," said analysts at Davy Stockbrokers.
The profit picture was mixed in Europe as well, at least on Monday.
Ericsson (SE:ERICB 71.90, +1.10, +1.55%) (ERIC 9.83, +0.07, +0.72%) shares fell 2.5% in Stockholm on after the telecom equipment maker said that net income for the three months to Dec. 31 fell to 314 million Swedish kronor from 3.89 billion kronor a year ago, following a hike in restructuring costs. Ericsson profit drops 92%
That fell below the 3.23 billion kronor analysts were expecting, according to data compiled by Dow Jones Newswires.
Shares of Philips Electronics (NL:PHIA 21.49, +1.16, +5.68%) (PHG 28.26, -0.79, -2.72%) rose 5.5%.
In contrast to Ericsson, the Dutch consumer electronics firm said that reduced charges helped it swing to a fourth-quarter profit of 251 million euros, compared to a loss of 1.2 billion euros last year. Philips swings to profit
Shares of German solar developer Conergy (DE:CGY 0.93, +0.13, +16.19%) surged 16% after it and MEMC Electronic Materials, Inc. (WFR 13.19, -0.98, -6.92%) announced they have reached an out-of-court settlement of a lawsuit related to a solar wafer supply contract.
The settlement "frees us from a significant burden that was damaging our competitive position, gives us greater business flexibility, and makes Conergy a much more attractive company," said Dieter Ammer, chief executive of the Hamburg-based firm.
