* FTSEurofirst 300 up 0.56 percent at 1365.93
EDINBURGH, July 16 European shares gained in
early deals on Wednesday, buoyed by strength in miners after
Chinese growth slightly beat expectations, hinting at resilient
demand in the world's largest metals consumer.
The STOXX Europe 600 Basic Resources index rose 0.7
percent, a top sectoral performer, after the world's
second-largest economy posted quarterly growth of 7.5 percent
from a year earlier, just ahead of a median forecast of 7.4
percent in a Reuters poll.
"It confirms the trend we've seen from improving PMI data,
and is in line with the idea of a pick-up in the global
economy," said James Butterfill, global equity strategist at
"There's a close correlation between Chinese industrial
production and the mining sector, so this pick-up is
Global miner Rio Tinto rose 1.6 percent after
reporting a sharp rise in iron ore output as it steps up
shipments to Chinese steel mills.
Rio is a top pick for analysts at Citi, who wrote in a note
to clients that recent Chinese economic data showed signs of a
Dutch blue chip toolmaker ASML, down 1 percent,
and Swedish telecoms firm Tele2, down 1.1 percent,
both reported better-than-expected quarterly earnings but had a
cautious tone for their full-year outlook statements.
Analysts at Espirito Santo said that "uncertainty remains
high" for Tele2.
"The core business in Sweden is performing relatively well
but the path to positive cash flow generation in Kazakhstan and
the Netherlands remains challenging."
Analysts have revised down their 2014 forecasts for earnings
by 2.3 percent over the last 30 days, according to Thomson
Reuters Starmine data.
The data also showed that the most accurate analysts expect
STOXX Europe 600 companies to miss consensus estimates for
quarterly earnings by 1.3 percent this earnings season.
The pan-European FTSEurofirst 300 rose 0.56 percent
to 1365.93, more than recouping the previous session's losses.
Stocks fell on Tuesday after declining investor morale hit
Germany's benchmark DAX equity index and worries over
Portugal's Banco Espirito Santo weakened the Lisbon
Shares in Banco Espirito Santo rose 5.5 percent on
Wednesday, rebounding after a 14.6 percent drop in the previous
session, with traders pointing to the extension of a
short-selling restriction on the shares of the Portuguese lender
and hopes that it can raise more capital if necessary.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up