Ericsson lifts tech sector higher as profits triple

Eurostoxx 50:2,977.59 (+22.23) Frankfurt DAX:7,404.95 (+48.44) Paris CAC:4,067.72 (+22.43)

EUROPEAN STOCKS advanced for a fifth day yesterday, led by technology and auto-industry shares, as companies from Ericsson to Volkswagen and Porsche reported better than estimated earnings.

“We’re quite happy with the earnings season,” Lothar Mentel, who oversees about $3.2 billion as the London-based chief investment officer at Octopus Investments, said on Bloomberg Television’s On the Move with Francine Lacqua.

“We know the first quarter has been good,” he said.

Of the 61 Stoxx 600 companies that have reported earnings since April 11th, 66 per cent have announced positive surprises, according to Bloomberg.

Greece’s ASE Index slid 1.8 per cent as the yield on the nation’s two-year bonds rose above 25 per cent for the first time.

National Bank of Greece, the country’s biggest lender, fell 5.3 per cent to €5.05, the lowest in eight years.

The US Federal Open Market Committee will release its statement on interest rates at 12.30pm in Washington, after the close of European stock markets.

Ericsson surged 11 per cent to 88.95 kronor, the biggest increase since January 2009.

VW climbed 5.2 per cent to €126.95, pacing a gauge of auto shares to the second-largest gain among 19 industry groups in the Stoxx 600.

Porsche rallied 6.2 per cent to €48.02 as its car-making division reported a first-quarter profit gain after a revamp of the Cayenne boosted demand for the sport-utility vehicle.

Volvo advanced 2 per cent to 115.9 kronor as the truck maker raised its 2011 sales forecasts for Europe and North America.

Renault climbed 3.8 per cent to €40.95. France’s second-biggest car maker said revenue increased to €10.43 billion in the first three months from €9.07 billion a year earlier.

Nokia Oyj gained 3.3 per cent to €6.16 as the world’s largest maker of mobile phones agreed to farm out its Symbian software development to Accenture.

Software advanced 2.9 per cent to €126.4.

Royal DSM soared 5.1 per cent to €45.63 after the Dutch vitamin and polymers maker reported first-quarter earnings that beat analysts’ forecasts. – (Bloomberg)