UK financials cap European shares, offset chemicals boost
* FTSEurofirst 300, Euro STOXX 50 both flat
* Barclays, Aberdeen weigh after weak updates
* DSM, Solvay boosted by brighter outlook
By Francesco Canepa
LONDON, May 6 (Reuters) - European stocks were flat on Tuesday as upbeat outlook statements from chemical groups Solvay and DSM were offset by sharp falls in Barclays and Aberdeen Asset Management after weak results.
Shares in Solvay and DSM both rose around 3 percent to be among top FTSEurofirst 300 risers as the former said it expects high single-digit percentage growth in core profit this year and the latter forecast higher earnings in the remainder of 2014.
They helped brighten the mood in a mixed earnings season so far in Europe, where 45 percent of STOXX Europe 600 companies missed consensus estimates and earnings forecasts for next 12 months have been cut by 0.9 percent over the past 30 days, StarMine data showed.
At 1004 GMT the pan-European FTSEurofirst 300 index was flat at 1,348.02, hovering close to a near six-year high hit on Friday. The Euro STOXX 50 was also flat at 3,170.33 points.
"It's good that the markets have stayed where they were despite this earnings correction," François Duhen, director of dedicated research at CM-CIC Securities in Paris, said. "Now that is done, earnings expectations are more sustainable."
Shares in Barclays and Aberdeen fell 4.4 percent and 5.9 percent respectively after they reported a drop in first quarter profit. Barclays was hit by weak fixed income revenue and Aberdeen by volatility in emerging markets.
The picture was brighter in the Iberian peninsula, where Spain's IBEX and Portugal PSI each rose 0.5 percent after stronger-than-expected results by Spanish infrastructure firm Abertis and Millennium bcp , Portugal's largest listed bank by assets.
Mergers & acquisitions activity once again helped buoy shares as traders speculated Finnish telecoms equipment maker Nokia could make a move for rival Alcatel-Lucent , sending shares in the French firm up 4 percent.
German auto parts and tyre maker Continental rose 3.2 percent as its finance chief Wolfgang Schaefer said the company aims to grow by buying firms and would be able to shoulder another multi-billion euro acquisition in the next 18 months.
Increased M&A activity has been a key source of support for European equities in the past month, helping offset concerns over tensions between Russia and western powers over Ukraine.
"Corporates turning expansionary is a major support," strategists at JP Morgan wrote in a note, recommending that investors remain buyers of European stocks.
"This is the next big catalyst that we were looking for to help stocks."
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up (Editing by Jane Merriman)