May 7, 2018 / 7:29 AM / a year ago

European shares buoyed by Nestle, updates; turmoil hammers Air France

MILAN, May 7 (Reuters) - European shares were supported in early trading on Monday by some good earning updates and gains in Nestle after the Swiss-based food giant agreed a tie-up with Starbucks.

A 12 percent drop in Air France on management turmoil and weakness among financials weighed, however, keeping the pan-European STOXX 600 index up only 0.1 percent, while UK markets were closed for a public holiday, reducing activity.

Nestle rose 0.6 percent after news it will pay $7.15 billion as part of a global coffee alliance in which the food group is getting the rights to market Starbucks products around the world outside U.S. coffee company’s shops.

Air France fell 12 percent after its CEO Jean-Marc Janaillac said on Friday he would resign after staff rejected a pay deal, plunging the airline into turmoil amid a wave of strikes at its French brand that has cost the company 300 million euros.

Over the weekend, the French government urged Air France managers and unions to resolve the stand-off.

Elsewhere, shares in Danish healthcare equipment maker Ambu and in Norway-focused independent oil company Aker BP rose 8.3 and 4.9 percent respectively following well-received earning updates. (Reporting by Danilo Masoni Editing by Alison Williams)

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