European share flatline on mixed earnings, economic data
* FTSEurofirst flat at midday * Apple outlook dents tech stocks * Auto stocks slip as French economic worries grow * Telcos boosted by Vodafone gains * Budget airlines rise after easyJet numbers By David Brett LONDON, Jan 24 (Reuters) - European shares were little changed around midday on Thursday as mixed company earnings coupled with conflicting economic data from the region made investors wary, with indexes at multi-year highs. By 1129 GMT, FTSEurofirst 300 was barely changed at 1,167.87, as the index continued to trade within a tight 10-point range it has held in since climbing to near two-year highs at the turn of the year. "Equities are trading sideways, capped by mixed earnings and conflicting messages out of Europe," Matt Basi, senior sales trader at CMC Markets, said. PMI business survey data from Germany showed its private sector expanded at its fastest pace in a year. But in France it showed a deepening downturn, hitting auto stocks. "We've seen indices trading through apparent technical levels, but this is definitely the lowest volume equity bull market I can remember, and with the VIX (a gauge of investor stress) bouncing along the bottom, the risk of an un-protected downside shock remains," he said. Tech stocks fell after bellwether Apple's revenue outlook missed expectations, knocking one of its major chip designers ARM down 0.5 percent, and Imagination Technologies down 1.6 percent. Among automakers, leading French manufacturers Renault and Peugeot fell 0.7 and 1.2 percent, respectively, with the sector down 0.7 percent. Earlier strong PMI factory data from China provided support for the basic resources sector and construction and materials which outperformed the broader index, each rising 0.3 percent. TELCO REBOUND CONTINUES Telecoms, having been major laggards in 2012, rose 0.5 percent, continuing their early 2013 bounce. Market heavyweight Vodafone provided a large chunk of the sector's gains, rising 2.4 percent on positive broker comment and takeover speculation, after the mobile telecoms firm circulated consensus forecasts to analysts ahead of its third-quarter trading update due on February 7. Goldman Sachs reiterated its "buy" stance but lowered its medium-term growth expectations and target price. Credit Suisse stuck with its "outperform" rating saying recent bullish guidance for 2013 from Vodafone's U.S. partner Verizon Wireless partly offset a slowdown in Europe and India. Hedge fund manager David Einhorn, whose moves are closely watched in the markets, told investors this week he recently added to his position in Vodafone, which owns 45 percent of Verizon Wireless. The head of Verizon Wireless' parent company Verizon Communications said it might buy Vodafone, a move Einhorn appeared to endorse. Mobile handset maker Nokia, which reported fourth-quarter results, shed initial gains, falling 1.7 percent after it axed its annual dividend payment for the first time in over 20 years to shore up its finances amid a fall in sales. The travel and leisure sector added 0.5 percent, buoyed by easyJet, which added 4.7 percent after the budget airline's quarterly revenue rose 9.2 percent. Competitor Ryanair rose 3.6 percent. In Europe, 80 percent of companies reporting earnings so far have either beaten or met expectations, although fourth quarter earnings have contracted by 0.8 percent year-on-year on average, according to Thomson Reuters Starmine data. Across the Atlantic, a bill to extend the U.S. debt ceiling temporarily also boosted sentiment, with traders saying a permanent deal could drive equity indexes through the multi-year highs they have stalled at. "The ultimate 'risk on' green light for markets would be an end to the political horse trading in Europe and the U.S.," a London-based trader said.
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