European shares recovered to trade slightly higher in a choppy session today, with investors pinning hopes on further economic stimulus in the United States, although mixed company results and poor macroeconomic outlook weighed on sentiment.
The pan-European FTSEurofirst 300 index was up 0.1 per cent at 925.12 points after falling to a low of 918.75 earlier in the session as some traders said a drop in Germany's business sentiment was not as bad as expected.
In Dublin, the Iseq index was up 1.8 per cent by 3.20pm while in London, the FTSE 100 was up by 2,2 per cent. In Germany and France, the DAX and CAC 40 were up 3.7 per cent and 2 per cent respectively.
US stocks extended gains at the opening today with the Dow and S&P 500 briefly rising more than 1 per cent on strength in bank shares.
The Dow Jones industrial average gained 92.94 points, or 0.83 per cent, to 11,269.70. The Standard & Poor's 500 Index rose 11.18 points, or 0.96 per cent, to 1,173.53. The Nasdaq Composite Index climbed 20.94 points, or 0.86 per cent, to 2,467.00.
Munich-based Ifo think tank said its business climate index, based on a monthly survey of some 7,000 firms, fell to 108.7, its lowest level in 14 months.
Greece's share benchmark fell 2.7 per cent, hitting its lowest in nearly 15 years, while Greek two-year government bond yields rose to their highest since the launch of the euro in 1999 as an escalating row over demands by Finland for collateral on Greek loans was seen complicating implementation of its rescue package.
Heineken, the world's third largest brewer, shed 11.4 per cent as it said depressed consumer confidence and poor summer weather would hit second-half figures after first-half profit fell short of expectations.
The results helped drag the Europe 600 Food & Beverage index 1.1 per cent lower, with the world's largest brewer Anheuser-Busch InBev , which recently warned of challenging times in its biggest market the United States, down 2.4 per cent.
Belgium-based insurer Ageas rose 12 per cent as it announced it would start a share buyback programme of its outstanding common stock for a maximum amount of up to €250 million, despite reporting lower-than-expected first-half profit.
Investors held their guns in anticipation of US Federal Reserve chairman Ben Bernanke's speech at an annual central bank conference in Jackson Hole on Friday, where it is expected he will provide hints for further measures to revive the struggling economy.
Trading volumes were thin, with volumes at 26 per cent of the 90-day average for the FTSEurofirst 300 and the STOXX Europe 600 by midday.
Nine out of 10 STOXX Europe 600 companies due to report in the second-quarter earnings season have done so, with half beating or meeting expectations and half missing them, Thomson Reuters StarMine data showed.
The average earnings miss of those who reported was 22.6 per cent, the data showed, while earnings for the third quarter have subsequently been downgraded by an average 2.9 per cent.
Reuters
