UPDATE 1-Graco Q2 earnings meet market view

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July 23 (Reuters) - Graco Inc (GGG.N), a maker of fluid handling systems and components, reported slightly lower second-quarter net income but was in line with analysts' view, and took a cautious view of its business in North America.

The company said strong international sales and growth in its industrial segment offset a decrease in contractor sales in the Americas.

The Americas account for about 60 percent of the company's sales, followed by Europe at about 26 percent.

Investments in product and market development along with rising costs continued to pressure earnings, it said in a statement.

Graco posted second-quarter earnings of $42.5 million, or 69 cents a share, compared with $44.2 million, or 66 cents a share, a year ago.

Sales rose 3 percent to $239.2 million.

Analysts on average had expected the company to earn 69 cents a share, excluding exceptional items, on revenue of $236.6 million, according to Reuters Estimates.

Shares of the Minneapolis, Minnesota-based company closed up 2 cents at $39.88 Wednesday on the New York Stock Exchange. (Reporting by Eric Yep in Bangalore; Editing by Gopakumar Warrier)