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European shares edge higher, tracking U.S. gains

Published 10/11/2010, 04:44 AM

* FTSEurofirst 300 rises 0.2 percent

* Broker upgrades boost Kuehne & Nagel, Nokia

* For up-to-the-minute market news, click on

By Brian Gorman

LONDON, Oct 11 (Reuters) - European shares edged up in early trade on Monday, tracking gains on Wall Street, after Friday's weaker than expected U.S. jobs data reinforced hopes that the Federal Reserve would inject fresh money into the economy.

On Friday, the Dow Jones Industrials closed above 11,000 for the first time in five months.

At 0831 GMT the FTSEurofirst 300 index of top European shares was up 0.2 percent at 1,073.23 points, after rising 1.2 percent last week.

The European benchmark is up more than 66 percent from its lifetime low of March, 2009, but has gained just 2.6 percent in 2010.

"The market is clearly expecting quantitative easing and has priced that in," said Richard Lacaille, global chief investment officer at State Street in London. "The data continue to be as expected, part of a slow recovery.

"Company earnings have been positive, by and large. Companies have been effective in driving their profitability. The lack of jobs is a reflection of people being efficient at the micro level." The heavyweight banking sector was among the gainers. HSBC, BNP Paribas and Societe Generale edged up by between 0.3 and 0.6 percent.

Across Europe, Britain's FTSE 100, Germany's DAX and France's CAC40 rose between 0.2 and 0.3 percent.

Trading was set to be subdued, due to the Columbus day holiday in the United States, where stocks will trade but the bond market will be closed.

Intel and JP Morgan are among companies reporting later in the week, as the U.S. earnings season gathers pace.

BROKER BOOSTS KUEHNE

With little in the way of corporate earnings on Monday, broker recommendations were behind some of the bigger movements, traders said.

Swiss logistics group Kuehne & Nagel International rose 2.4 percent after Nomura raised its rating to "buy" from "neutral", citing expectations of bigger volumes.

Norwegian fertiliser maker Yara International rose 2.9 percent after Deutsche Bank raised its price target.

Aerospace and defence group EADS fell 3 percent after Citigroup downgraded it to "hold" from "buy". The recent strengthening of the euro against the dollar also hurt the shares.

Mobile phone maker Nokia rose 2 percent after Nordea raised its rating to "strong buy". (Editing by Greg Mahlich)

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