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Earnings support European shares but oil slump weighs

Published 06/07/2017, 03:15 am
Updated 06/07/2017, 03:20 am
© Reuters.  Earnings support European shares but oil slump weighs
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* STOXX 600 index up 0.2 pct

* Adidas top gainer on earnings optimism

* Well received updates lift CHR, Persimmon

* But energy stocks weigh as oil drops (Writes through, adds details, closing prices)

By Danilo Masoni

MILAN, July 5 (Reuters) - European shares rose on Wednesday at the end of a volatile session with gains among consumer stocks, led by Adidas ADSGn.DE on optimism over its upcoming earnings.

A renewed slide in oil prices kept a lid on the increase, with the pan-European STOXX 600 .STOXX index ending up 0.2 percent while the euro zone blue chip index .STOXX50E closed flat.

The top gainer on the STOXX was CHR Hansen CHRH.CO after the food ingredients maker beat third-quarter profit forecasts and raised its revenue growth guidance. was the second biggest, up 4.9 percent as brokers sounded upbeat ahead of the sporting goods group's earnings release next month.

While DZ Bank added the stock to its long list expecting strong numbers in Western Europe and China, HSBC said Adidas was likely to increase its outlook, upgrading it to "buy". believe the sales growth story and associated margin expansion plan make this stock a very visible compounder," HSBC analysts said in a note.

In London, housebuilder Persimmon PSN.L jumped 2.4 percent after it reported a 7 percent rise in first-half sales. prices retreated 3 percent, ending their longest bull run in more than five years as rising OPEC exports and a stronger dollar turned sentiment more bearish.

That hurt energy stocks .SXEP , the biggest sectoral faller in Europe this year, which fell 1.4 percent, wiping most points off the STOXX index.

Miners .SXPP , which also find support when oil prices rise, ended up 0.2 percent, paring earlier gains that were helped by a Credit Suisse (SIX:CSGN) sector upgrade to "overweight".

Top faller in Europe was Worldpay WPG.L , down 8.8 percent after U.S. credit card processor Vantiv VNTV.N agreed to buy the British payment company for 7.7 billion pounds.

In the previous session the stock soared nearly 30 percent after news of rival approaches from Vantiv and JPMorgan (NYSE:JPM) JPM.N , which said on Wednesday it did not plan to make a counter bid.

Interest rate-sensitive utilities .SX6P were another weak spot, down 0.7 percent.

A rise in interest rates has been a focus for markets since central banks hinted at a possible tightening in monetary policy, with higher bond yields making high dividend-paying stocks like utilities less attractive.

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