(Reuters) - European shares finished higher on Friday as some strong earnings and data showing U.S. economic growth in the first-quarter beat expectations helped cut losses from earlier in the session.
The pan-European STOXX 600 index closed up 0.2 percent, led by drugmaker Sanofi and aero engine maker Safran, on upbeat earnings, while a turnaround in banks to the black after U.S. data also helped overcome the day’s losses of up to 0.9 percent.
Positive U.S. economic growth came as a relief, helping STOXX 600 post gains on the week, after dismal economic data from South Korea and Germany earlier this week had sounded alarm bells on global growth.
In April, its has so far gained over 3 percent, on course to extend monthly gains to a fourth straight month.
But, STOXX 600 had briefly retraced session highs hit on the data as investors digested that the burst in growth was driven by temporary factors that are likely to reverse in the coming quarters.
While most country indexes rose, London’s energy-heavy FTSE 100 ended lower as a fall in crude prices hurt oil majors. [O/R]
Banks benefited with gains by HSBC, Standard Chartered and Commerzbank helping the sector index overcome earlier losses logged on disappointing results from RBS and Deutsche Bank.
Healthcare, which is also seen as a defensive sector, was a bright spot. Gains of 3.5 percent by French drugmaker Sanofi after it returned to growth with higher profits and revenues for the first-quarter was the biggest boost to the pan-region index.
Safran followed, up 3.4 percent, after it outpaced revenue growth plans in the first quarter. Along with positive outlook by Renault and Ford and Valeo, it took Europe’s auto sector 0.9 percent higher.
Reports that Renault will propose to Nissan Motor Co a plan to create a joint holding company which would give both firms equal footing, also aided the rally in the French automaker.
Continental AG advanced after it backed its outlook for the year despite reporting a fall in first-quarter earnings.
Luxembourg-based satellite operator SES led media stocks higher after it maintained its full-year outlook on the back of the company’s Networks division.
Weighing on the broader regional benchmark index were oil stocks, tracking a decline in oil prices after U.S. President Donald Trump said he called OPEC and told the cartel to lower oil prices. [O/R]
France’s Total fell after it reported a falling first-quarter net profit.
Miner Glencore slipped 3.3 percent as U.S. regulators investigated if the company engaged in ‘corrupt practices’.
Chip stocks in the region including Siltronic, Ams and STMicroelectronics lost after Intel Corp reduced its full-year revenue forecast, adding to concerns that an industry-wide slowdown could persist until the end of 2019.
Reporting by Medha Singh, Agamoni Ghosh and Susan Mathew in Bengaluru; Editing by Gareth Jones, Elaine Hardcastle and Peter Graff