adminLondon. – European stocks were little changed near a five-year high as companies from Eni SpA to Volkswagen AG posted profit that exceeded estimates, while telecommunications companies retreated.
Eni contributed the most to a gain by a gauge of oil companies.
Volkswagen advanced 5,2 percent as Europe’s largest carmaker said cost cutting contributed to higher earnings.
TomTom NV added 3,6 percent after the Dutch maker of navigation systems raised its forecast for 2013. Belgacom SA dropped 5,2 percent as a competitor cut the price of its mobile-phone plans.
The Stoxx Europe 600 Index added 0,1 percent to 321,09 at 3:03pm in London after earlier climbing as much as 0,7 percent.
The gauge has still advanced 3,4 percent this month as US lawmakers agreed to lift the federal debt ceiling and investors speculated that a worse-than-forecast payrolls report would delay a reduction in the Fed’s bond-buying programme.
“Investors are pricing in an earnings recovery for 2014,” said Francois Savary, who oversees about US$9,5 billion as chief investment officer at Reyl & Cie. in Geneva.
“People are buying European equities because of future expectations. You can judge that the market is going in the right direction because we expect to see some growth next year,” he said.
As the buying of European stocks is likely to continue more business is expected in the next coming months well he said.
US companies added 130 000 workers in October, fewer than the 150 000 median projection in a Bloomberg survey of economists, according to a report from the ADP Research Institute today.
That was the lowest reading since April. Businesses hired a net 145 000 people in September.
The Federal Open Market Committee meets for a second day to discuss monetary policy.
The 16-day shutdown of the US government earlier this month will reduce economic growth by 0,3 percentage points this quarter at an annual rate, according to a Bloomberg News survey of economists.
The central bank will probably delay lowering its US$85 billion in monthly bond purchases until March 2014, economists forecast in the survey.
National benchmark indexes dropped in 11 of the 18 Western-European markets.
The UK’s FTSE 100 increased 0,1 percent, while France’s CAC 40 and Germany’s DAX Index lost 0,2 percent.
Eni rose 2 percent to 18,47 euros after the Italian oil producer posted adjusted net income of 1,17 billion euros (US$1,6 billion) for the third quarter, more than the 998 million euros that analysts had predicted for the period.
Volkswagen rallies
Volkswagen gained 5,2 percent to 183,85 euros after posting quarterly earnings before interest and taxes that jumped 20 percent to 2.78 billion euros.
That exceeded the average analyst estimate of 2,72 billion euros.
TomTom advanced 3,6 percent to 6,11 euros. The company forecast adjusted earnings of 25 euro cents a share this year.
It had projected 20 euro cents apiece.
TomTom also said that this year’s sales will approach the upper end of its 900 million euros to 950 million euros range.
Barclays Plc climbed 1,1 percent to 269 pence which is now proving its resurgence after a brief lull at the beginning of this year, a move say is a great sign of recovery.
Credit impairment charges dropped 6 percent to £2,4 billion (US$3.9 billion) in the first nine months of this year, according to a statement.
Third-quarter pre-tax profit, excluding gains and losses on the bank’s own debt, fell 26 percent to ₤1,39 billion, matching the median analyst estimate compiled by Bloomberg.
Orkla ASA rallied 5,4 percent to 48,70 kroner.
Operating profit for the Orkla Foods business rose to 364 million kroner (US$62 million) in the period from 312 million kroner in 2012.
Belgacom declined 5,2 percent to 20,54 euros. Telenet Group Holding NV, which competes with Belgacom in Belgium, cut its prices for mobile-phone tariffs.
Standard life
Standard Life Plc slipped 3,4 percent to 356,5 pence after reporting that its asset-management business received net inflows of ₤1,2 billion in the three months through September, less than half the ₤2,6 billion that it reported during the same period last year.
Fiat SpA (F) fell 2,2 percent to 5,70 euros.
The Italian carmaker lowered its forecast for trading profit this year to 3,5 billion euros to 3,8 billion euros.
It had projected earnings on that measure of as much as 4,5 billion euros, and it means that they are on the right track to achieve that goal.
The company also posted third-quarter profit in Latin America that tumbled 52 percent to 165 million euros.
Pearson Plc declined 2.8 percent to 1,327 pence after forecasting that the margins for its education unit will drop in 2013 because of weaker demand for college textbooks.
The publisher had forecast in July that the margins would be similar to those in 2012 although they will rise. Viscofan SA sank 7,7 percent to 39,52 euros after the Spanish maker of sausage casings said it will probably miss its targets for 2013 because of weak currencies.
The company in July predicted net income of 107 million euros to 108 million euros and earnings before interest, taxes, depreciation and amortisation of as much as 195 million euros for this year.
Piraeus Bank SA slid 10 percent to 1,47 euros after Banco Comercial Portugues SA sold 235 million shares in the Greek lender for 1,50 euros apiece.
The Portuguese bank also sold the same number of warrants at 60 euro cents each. – Bloomberg.
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