European shares hold on to small gains ahead of Fed announcement
* FTSEurofirst 300 up 0.3 pct * Fugro tumbles 26 pct after cancelling payout * Total and Schneider up after results By Francesco Canepa LONDON, Oct 29 (Reuters) - European stocks held on to small gains on Wednesday, as optimism ahead of a U.S. Federal Reserve policy announcement outweighed further gloom for the oil exploration industry. Dutch marine services group Fugro sank 26 percent after it warned it would not pay a dividend for 2014 due to deteriorating markets and price pressure on oil and gas projects. The dividend cut, which came hard on the heels of a profit warning from Italian oil industry services group Saipem on Tuesday, sent shares in sector peer CGG down 3.4 percent. Providing some support to the battered energy sector, investors welcomed oil major Total's decision to maintain its dividend while pressing ahead with cost cuts after falling oil prices squeezed its third-quarter profits. The shares rose 2.4 percent. The broader FTSEurofirst 300 index of top European shares was up 0.3 percent at 1,321.32 points by 1534 GMT, rising for the fourth of the last seven sessions, albeit in low volume. Trading volume on the index was 40 percent lower than its average for the past month. Global shares have rebounded during that time after a sharp pullback, as investors took heart from generally strong corporate earnings, especially in the United States, and the prospect of an accommodative stance from Federal Reserve. The market expects the Fed's Federal Open Market Committee to announce it will end years of stimulus measures this month but also send a soothing message by signalling interest rates are not likely to rise soon. "The volumes into the rally are waning," Monument Securities head of sales, Andy Ash, said. "As we approach the FOMC meeting and the month end, we have catalysts to pivot once again." Fiat Chrysler Automobiles (FCA) surged 12 percent as it unveiled plans to list a 10 percent stake in luxury brand Ferrari and issue $2.5 billion in convertible bonds to help fund the parent company's turnaround plan. Europe bourses in 2014: link.reuters.com/pap87v Asset performance in 2014: link.reuters.com/gap87v Today's European research round-up OUTLOOK MIXED European corporate results have been largely in line or above expectations so far, although outlooks remained mixed. Industrial group Schneider Electric rose 3.1 percent after reporting a 7 percent rise in third-quarter sales and saying Western Europe showed long-awaited but fragile signs of stabilisation. Europe's largest semiconductor company STMicroelectronics shed 9.2 percent after posting higher-than-expected quarterly net profit but saying margins would be flat and revenue would fall in the final quarter due to a softening market. Spanish bank BBVA, down 4.2, weighed on the euro zone Euro STOXX 50 index as it reported a lower-than-expected net profit for the first nine months of the year and said its investment in improving its digital banking offering could hit profits in the fourth quarter. About a third of companies listed on the STOXX Europe 600 benchmark index have reported results so far in the earnings season, with 67 percent of them meeting or beating profit forecasts, and 59 percent meeting or beating revenue forecasts, according to Thomson Reuters Starmine data. In absolute terms, European companies have posted a 13.6 percent rise in quarterly earnings and 0.7 percent in revenue. (Additional reporting by Blaise Robinson in Paris and Vikram Subheadar in London; Editing by Andrew Roche)
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