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European stocks end narrowly mixed

European stocks end narrowly mixed

European stocks mainly rose Tuesday after gains the day before as investors embraced more signs that the fallout from the recent credit crisis is on the wane.
The U.K.'s FTSE 100 Index closed 0.1 percent lower at 6,500.40, while France's CAC-40 Index climbed 0.5 percent to 5,799.27 and Germany's DAX Index finished up 0.3 percent at 7,946.79.
"As long as liquidity does flow back into the system, and earnings growth remains positive, we see equity markets as a longer-term buy," says Andrew Milligan, head of global strategy at Standard Life Investments.
European banks benefited from an easing of risk aversion and flights to safe-haven and quality assets, analysts said. France's Societe Generale and BNP Paribas, both heavily marked down on recent subprime worries, led an advance by the bank sector and gained 4.1 percent and 2.5 percent higher, respectively.
Shares of Swiss bank UBS also gained 3 percent after analysts at JP Morgan raised their recommendation.
U.K. banks also joined the rally, with Alliance & Leicester closing up 5.5 percent. Barclays climbed 3.4 percent and HBOS was up 4.3 percent.
"The share prices in many cases discount a far more severe scenario. ... We see scope in the final quarter for the U.K. banks sector to rally as the worst fears do not materialize," analysts at Casenove said in a research note to clients.
Retail stocks gained following better-than-expected results from Tesco, the largest retailer in the U.K. by sales and Europe's third-largest by the same measure. Tesco shares rose 6.3 percent after the group reported a 19 percent increase in first-half profit and said it remains confident about the remainder of the financial year. Analysts said the results affirmed beliefs that negativity surrounding the U.K. consumer environment is overdone.
"Consumer spend would appear to be well-supported moving towards the Christmas period," retail analysts at Lehman Brothers said in a research note.
Dutch printer and photocopier maker Oce NV rose 1.4 percent as it said its third-quarter net profit almost doubled, although its biggest unit reported an operating loss.
Navigation device maker TomTom NV formally launched a bid for digital map maker Tele Atlas that values the company at around euro2 billion (US$2.8 billion). The group is one of two leading providers of digital maps, competing with U.S.-based Navteq. Nokia on Monday agreed to buy Navteq for about US$8.1 billion (euro5.7 billion).
TomTom shares fell 4.5 percent while Tele Atlas shares rose 4.4 percent.
Shares in Danish pharmaceutical company H. Lundbeck A/S rose 8 percent after it announced positive phase-two trial results for its new antidepressant compound.
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Kimberly Vlach is a correspondent for Dow Jones Newswires.


Updated : 2021-10-20 17:25 GMT+08:00