* FTSEurofirst 300 flat
* Earnings from GKN, Range and Next provide a boost
* BP results see muted reaction after Russia warning
* Market cautious as EU prepares sanctions
By Alistair Smout
EDINBURGH, July 29 European shares were
unchanged on Tuesday, as encouraging corporate results were
offset by the threat of economic fallout from more sanctions
Parts maker GKN rose 6.5 percent as growth in its
car business offset adverse currency effects. Telecom company
Orange and UK-listed fashion retailer Next
also rose after results.
However, carmaker Renault fell 3.2 percent. Its
profits beat expectations, but cost-cutting helped to put a
gloss on falling sales.
After 32 percent of companies reported results, 60 percent
of STOXX Europe 600 companies have beaten or met
The pan-European FTSEurofirst 300 was steady at
1,369.12 points by 0812 GMT, giving up earlier gains as markets
remained cautious about the situation in Ukraine.
BP rose 0.4 after posting a 34 percent increase in
profit. But its gains were limited by the prospect of further
sanctions on Russia, which it said "could have a material
adverse impact" on its joint venture in the country.
Tony Cross, market analyst at Trustnet Direct, said that the
threat of sanctions was taking the shine off an otherwise
"I would have thought a 1 percent to 2 percent
over-performance even as some kind of short-term relief rally
could have been justified," Cross said.
European Union member states were expected to seek a final
agreement on Tuesday to take stronger measures that would
include closing the bloc's capital markets to Russian state
On Monday, five Western leaders agreed to impose wider
sanctions on Russia after a Malaysian airliner was shot down
over territory held by pro-Moscow rebels in eastern Ukraine.
Markets worried that the move will provoke economically damaging
tit-for-tat measures from Moscow.
"Politicians are under increased pressure to implement much
more aggressive sanctions, which not only run the risk of
retaliation from Russia but also might hurt the European economy
itself," Markus Huber, senior sales trader at Peregrine & Black,
"It wouldn't come as much of a surprise if stocks would at
least temporarily enter a consolidation pattern with ...
range-trading appearing likely overall"
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Editing by Larry King)