* FTSEurofirst 300 up 0.2 percent
* Swiss luxury goods stocks among top risers
* Miners hurt by profit-taking
* Next gains after trading update
By Tricia Wright
LONDON, Jan 3 European shares edged up on
Thursday thanks to Swiss stocks climbing as the Zurich bourse
reopened after a holiday, with luxury goods issues among the top
The FTSEurofirst 300 rose 0.2 percent to 1,159.37
by 1231 GMT, having jumped 2.1 percent the previous session on
relief a last-minute U.S. budget deal was struck to avoid huge
tax hikes and spending cuts that could have pushed the world's
largest economy into recession.
While the FTSEurofirst 300 is now at 20-month highs,
however, the stage looks set for more potentially bruising U.S.
showdowns over the next two months on spending cuts and an
increase in the nation's borrowing limit.
"We've had a number of these rallies in the past few months
where basically policymakers step back from the precipice, but
underneath it all what's really changed? They've deferred the
difficult decisions to further down the line," Michael Hewson,
senior analyst at CMC Markets, said.
The FTSEurofirst 300 leaders' board was made up solely of
Swiss stocks, led by luxury goods group Richemont,
which enjoyed a 5.2 percent advance, while peer Swatch
added 4.8 percent, helped by upbeat manufacturing data released
over the holiday period from China, a big market for the sector.
Traders also cited a Morgan Stanley note saying the decline
seen in Chinese watch and jewellery sales from the second half
of 2011 to the second half of 2012 was bottoming out, with
Swatch best placed to outperform.
The euro zone's blue-chip Euro STOXX 50
meanwhile, slipped 0.6 percent to 2,695.82, having moved into
"overbought" territory on Wednesday with a 2.9 percent leap that
left it vulnerable to a pullback.
CMC's Hewson reckons the index will find support within the
gap higher seen at Wednesday's open, between 2,635 and 2,659,
and that it will continue to drift higher to the 2,800 level,
around the July 2011 highs, over the next couple of months.
Mining stocks ran into profit-taking, having lurched
4.6 percent higher on Wednesday on the back of upbeat Chinese
data and the U.S. budget deal.
Next was a gainer on Thursday, up 2.2 percent in
brisk trading volume, after the British retailer nudged up its
full-year profit forecast.
Next kicked off the post Christmas UK retail reporting
season by saying it expected a year to the end of January 2013
pretax profit of 611-625 million pounds against previous
guidance of 590-620 million pounds.
Trading volume in Next shares came to 102 percent of its
90-day daily average.
"Retail bellwether Next had it all to do as the first
retailer to report on Christmas trading, and as on so many
occasions before, it did not disappoint. Where an in-line
performance would have been quite good enough to kick off the
all important retailer January trading statements, Next actually
upped guidance to the top end of expectations," said Richard
Curr, head of dealing at Prime Markets.
"Prime Markets see little on the horizon to stand in the way
of the Next retailing juggernaut," Curr added, recommending
investors buy the stock with a 4,000 pence target.