April 18, 2018 / 7:31 AM / 5 months ago

European shares advance as earnings season gathers pace

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LONDON, April 18 (Reuters) - European shares bobbed along on Wednesday, supported by a slew of well received company results as the focus turned from geopolitics to the first-quarter earnings season.

The pan-European STOXX 600 index was up 0.1 percent by 0720 GMT, while the FTSE 100 gained 0.3 percent and Germany’s DAX ticked 0.1 percent higher. A rise among more cyclical sectors, such as materials, financials and industrials, contributed the most to gains.

Company updates were broadly rewarded with a bounce in shares, as French food group Danone rose 2.8 percent after its first-quarter sales beat forecasts on the back of strong demand for baby food in China.

Private healthcare provider Mediclinic rose 3.6 percent after a full-year update, while Dutch oil and chemical storage company Vopak gained 4 percent after saying it has the potential to significantly improve earnings in 2019.

The European first-quarter earnings season is expected to deliver moderate earnings growth, especially compared with the United States.

European earnings are expected to increase 1.9 percent from the same quarter in 2017, which would be a rise of 0.8 percent excluding the energy sector, according to Thomson Reuters I/B/E/S data.

Aside from earnings, deal-making was not far from the action after British property company Hammerson withdrew its recommendation that shareholders back a merger with smaller rival Intu Properties.

Shares in Hammerson rose 3.4 percent, while Intu Properties fell nearly 7 percent, the worst-performing stock on the STOXX 600. (Reporting by Kit Rees)

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