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Europe: Stocks edge ahead, led by Nestle and Ferrovial
[LONDON] European shares inched higher on Thursday at the end of a choppy day, with food company Nestle gaining after an encouraging earnings update and Ferrovial leading the advance on a broker's upgrade.
The pan-European FTSEurofirst 300 index, which had risen 2.6 per cent to its highest level since March 14 in the previous session, ended up 0.3 per cent without making a fresh closing high.
The FTSEurofirst remains down around 6 per cent since the start of 2016, as concerns about a China-led economic slowdown hit world stock markets and commodity prices.
But oil prices rose slightly on Thursday after the International Energy Agency said a decline in oil output in the United States was speeding up.
That helped shares in oil companies such as Total and Royal Dutch Shell turn higher and trade last up 0.6 per cent and 0.9 per cent respectively.
Nestle rose 2 per cent as the food group confirmed its full-year outlook after first-quarter underlying sales growth beat expectations. "Nestle has printed a decent number and consensus should nudge up. Given the disappointments of the last couple of quarters, this is extremely encouraging," Kepler Cheuvreux analyst Jon Cox said in an emailed comment.
Spanish infrastructure company Ferrovial rose 3.8 per cent, the biggest gain on the FTSEurofirst, after Exane BNP Paribas upgraded the stock to to outperform from underperform.
Burberry slumped 3.6 per cent after the British luxury goods group reported second-half sales had declined. "Near term, Burberry has high exposure to weakest areas of luxury demand: 38 per cent of global sales to Chinese customers versus 30 per cent industry average, 27 per cent sales exposure to US," Liberum said, keeping a "sell" rating on the stock.