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Earnings and dovish ECB lift European shares to five month high

Published 27/10/2017, 08:35
© Reuters. The German share price index, DAX board, is seen at the stock exchange in Frankfurt
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MILAN (Reuters) - European shares rose to their highest in nearly five months on Friday boosted by solid results from companies including Swiss bank UBS as investors cheered for a second day prospects that the ECB would remain accommodative for longer.

While the pan-European STOXX 600 (STOXX) index added 0.4 percent by 0726 GMT, set for a weekly gain of around 0.8 percent after a fall in the previous week, euro zone blue chips (STOXX50E) were set for their ninth straight week of gains.

The ECB took a step towards weaning the euro zone off loose money on Thursday but promised years of stimulus and even left the door open to backtracking.

On Friday, UBS (S:UBSG) rose 2 percent after the world's biggest private bank posted a 14 percent jump in third-quarter net profit but kept a cautious outlook for the rest of 2017 due to political and monetary policy uncertainty.

Royal Bank of Scotland (L:RBS) added 2.7 percent after the UK bank posted a better than expected quarterly profit.

Tech stocks (SX8P) were strong, up 0.7 percent, following upbeat earnings from U.S. giants Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN).com. In the sector, digital security company Gemalto (AS:GTO), which has issued four profit warnings in the last year, rallied 11 percent as results reassured.

Top loser on the STOXX was Eutelsat (PA:ETL) after the satellite firm reported lower revenues.

© Reuters. The German share price index, DAX board, is seen at the stock exchange in Frankfurt

According to Thomson Reuters data 34 percent of MSCI Europe companies have reported results so far, with earnings beats at 54 percent and misses at 36 percent. Revenue beats were 52 percent and misses 48 percent.

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