European stocks inch higher, Siemens earnings cheer High Street Networking

29 July 2004, 12:16 European stocks inch higher, Siemens earnings cheer

Upbeat earnings from German conglomerate Siemens and software maker Dassault Systemes helped European equities higher on Thursday, with Wall Street's overnight turnaround also lending support. UK phone operator BT Group , however, was a weak spot after saying the environment remained tough, and despite slightly better-than-expected first quarter revenues. Investors, scouring a flood of earnings on one of the quarter's busiest reporting days, also cheered Vedior's forecast-beating quarterly operating profit and bullish sales outlook, lifting shares in the Dutch temporary employment agency 3.7 percent. But this was not enough to quell investors' worries about the sustainability of earnings growth looking forward, strategists said. Such doubts have dodged equity markets in recent weeks, pushing the FTSE Eurotop 300 <.FTEU3> to its lowest 2004 close on Monday. "So far the numbers we've seen are pretty good but people are still debating whether equity markets will resume selling," said Nomura strategist Anais Faraj.
"Those firms like Alcatel giving update guidance are the market darlings at the moment and they are just confirming what the market has been pricing in." "Essentially what you're getting now is survival of the fittest, and that's one of the reasons why the markets are becoming so choppy," he said, adding that a fresh surge of oil prices to $43 a barrel was another big factor capping sentiment. By 0705 GMT, the FTSE Eurotop 300 index <.FTEU3> of pan-European blue chips gained 0.3 percent to 971.5 points, and the narrower DJ Euro Stoxx 50 index <.STOXX50E> added 0.4 percent to 2,676 points.
SIEMENS PLEASES
Siemens pleased by posting higher quarterly revenue for the first time in more than two years and operating income up more than 20 percent year-on-year. The group said it was also confident of exceeding its targets for the full year, pushing its shares 2.1 percent higher to be the top blue-chip gainer. Dassault Systemes was another gainer, up 1.8 percent after the French software maker posted forecast-topping second-quarter earnings per share before acquisition costs and raised its sales and profit outlook for the year. Elsewhere, Alcatel swung to a forecast-topping second-quarter net profit of 23 million euros from a net loss of 675 million in the year-ago period and issued a buoyant trading update for the rest of the year on the back of improved prospects in all its key markets. But its shares shed 1.7 percent as dealers said the good news was already priced in. Meanwhile, EADS shares rose 2 percent after the group reported a first-half net profit that more than doubled and raised its forecast for full-year operating earnings by 9 percent to about 2.1 billion euros. Investors still awaited earnings from German car giant DaimlerChrysler as the company announced a senior management rejig. In New York on Thursday, the Dow Jones industrial average <.DJI> ended up 0.3 percent at 1,084.07, after pleasing earnings from Boeing helped the index erase earlier losses spurred by a surge in crude oil prices. The tech-laden Nasdaq Composite <.IXIC> finished down 0.58 percent at 1,858.26 points.///www..com