* FTSEurofirst 300 up 6.62 points at 1,298.20
* ING, Adecco rally after beating earnings forecasts
* EasyJet takes off on bullish passenger numbers
* Experian falls after results as BofA ML cuts rating
By David Brett
LONDON, Nov 6 European shares rose on Wednesday,
erasing the previous session's losses, after a batch of
better-than-expected corporate results lifted sentiment.
The FTSEurofirst 300 was up 6.62 points, or 0.5
percent at 1,298.20. It was at five-year highs but within the
18 point range it has been in since mid-to-late October.
Investors welcomed forecast-beating results from Dutch
banking and insurance group ING and Adecco,
the world's No. 1 staffing agency, while cement major Lafarge
confirmed debt reduction targets for this year and
ING, Adecco and Lafarge rose as much as 5.7 percent.
Budget airline easyJet rallied 2 percent after
announcing a 5.4 percent rise in October passenger traffic, and
infrastructure firm Alstom jumped 5.6 percent after
allaying fears that the company would need to raise capital as
it said its balance sheet was robust.
But concerns linger over the general outlook for earnings,
which are still experiencing more downgrades than upgrades
according to Datastream.
Half way into the European earnings season, 52 percent of
STOXX Europe 600 companies have missed profit
forecasts, and two thirds have missed revenue forecasts,
according to data from Thomson Reuters StarMine. This is in
sharp contrast with the second-quarter results season during
which only 42 percent of companies missed profit forecasts.
That is leaving valuations on indexes at multi-year highs
looking on the expensive side compared with earnings momentum -
12-month forward price-to-earnings on the STOXX 600 is
around 13.6 times, well above its 10-year average.
"Markets are looking a bit toppy although it looks like the
rally (the path of least resistance) will continue for now,"
Mark Ward, head of trading at Sanlam Securities, said.
European stocks have been rallying over the past four weeks,
boosted in part by expectations that both euro zone and U.S.
monetary policy will remain accommodative for some time.
Recent tame inflation figures have fuelled speculation about
a possible interest rate cut by the European Central Bank when
it meets on Thursday.
"A Eurozone rate cut should be enough to keep the markets
happy for now although people will be looking for an excuse to
take profits," Sanlam's Ward said.
British credit data provider Experian shed 7.6
percent, the top faller in Europe as BofA ML downgraded its
rating on the company to "neutral", citing valuation concerns
after Experian reported first-half results.
Unilever, the household goods firm which recently
issued a profit warning, slipped 1.6 percent with traders citing
Nomura's downgrade of the company to "neutral" as weighing on
the shares. "We see minimal returns until FY2013 results," the
Vopak, the oil services firm, shed 1.6 percent
after reporting a 5 percent fall in three-quarter EBITDA.