* FTSEurofirst 300 index rises 0.3 pct
* Cyclicals advance, financial services sector up
* Man Group rises; Erste, Pearson slip
By Atul Prakash
LONDON, Feb 28 European shares edged higher on
Friday, with cyclical stocks boosted by positive company news
and expectations that a further drop in euro zone inflation may
prompt the European Central Bank to ease policy.
Figures due at 1000 GMT are forecast to show inflation in
the currency bloc falling to 0.7 percent in February from 0.8
percent in the previous month, according to a Reuters survey,
but some analysts expected an even lower reading of 0.6 percent.
"The inflation data could be a trigger for the ECB to cut
rates again. In the second half of the year, you could also see
the central bank start buying assets in the American style,"
Philippe Gijsels, head of research at BNP Paribas Fortis Global
Markets in Brussels, said.
"These measures have potential to favourably impact the
A third of economists polled by Reuters has pencilled in a
cut in the ECB's refinancing rate from 0.25 percent at its March
At 0848 GMT, the FTSEurofirst 300 index of top
European shares was up 0.3 percent at 1,348.76 points, supported
by sectors such as financial services, insurance and technology.
The European financial services index rose 0.7
percent to the top of the sectoral gainers' list, led higher by
The hedge fund company, which surged 14 percent on Thursday
after announcing a share buyback and bumping up its dividend,
rose another 4.6 percent after UBS, Barclays and Jefferies
raised their price target for the stock.
Among other sharp movers, financial services group Old
Mutual jumped 4.6 percent after posting a 15 percent
rise in profits.
European stocks were also supported by U.S. equities after
the S&P 500 closed at a record high on Thursday after
Federal Reserve Chair Janet Yellen said harsh weather seemed to
be behind recent U.S. economic softness.
The FTSEurofirst 300 index headed for its best monthly
performance since July last year, however some disappointing
company news and Ukraine tensions kept gains in check, traders
Austrian lender Erste Group plunged 7.5 percent
after proposing to halve its dividend, while British publisher
Pearson fell 6.6 percent after warning its earnings
could fall in 2014. Pearson's results came in within the range
of already downgraded forecasts.
Investors also remained nervous about the situation in
Ukraine, where armed men took control of two airports in the
Crimea region on Friday in what Ukraine's government described
as an invasion and occupation by Russian forces, stoking tension
between Moscow and the West.
"Ukraine is a political risk. As long as the markets are
convinced that Russia is not going to take a hard stance on the
issue, it is something to watch but not a game changer," Gijsels
Europe bourses in 2014:
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Today's European research round-up