European shares hold on to small gains ahead of Fed announcement

miércoles 29 de octubre de 2014 11:44 GYT

* 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
    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:
    Asset performance in 2014:
    Today's European research round-up 
    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
    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)