By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- European stocks ended mostly higher on
Thursday, as upbeat global factory data encouraged investors to
take on more risk, offsetting disappointing earnings from Apple
Inc.
The Stoxx Europe 600 index gained 0.2% to close at 288.89, the
highest closing level since February 2011.
Weighing on the index, however, shares of Nokia Corp. (NOK)
slumped 5.5% after the Finnish handset maker said it swung to a
profit of 5 euro cents a share in the fourth quarter, beating
consensus earnings of 2 euro cents a share. Sales, however, fell
20% to 8.041 billion euros, falling short of estimates. The company
also scrapped its dividends for 2012. .
Frances Hudson, global thematic strategist at Standard Life
Investments, said that the overall trading mood remained
directionless as "the clues we're getting have not been terribly
helpful and are not conclusive in one direction or the other."
"From a macro point of view we're in glass-half-full mode. We
got better PMIs and people are taking that as a positive. But even
when the data has not been terribly supportive, like the Japanese
trade data, there's a feeling that the market is willing to be
quite optimistic," she said.
But market participants were also preoccupied with the earnings
season in the U.S., where a disappointing earnings report from
Apple (AAPL) weighed on the broader risk sentiment globally early
in the trading day, sending both Asian and European markets lower.
.
"We've seen other less impressive results and it's clear that
it's still a difficult business environment. Apple was a trigger to
see that," Hudson said.
Apple is the most valuable company in the world, "but to
maintain that leadership you need to keep innovating and have the
next new product waiting and we don't know what that next new
product is," she said.
U.S. markets had closed in positive territory on Wednesday,
after the Republican-controlled House of Representatives approved a
suspension of the debt ceiling until May 19. .
On the data front in the U.S. on Thursday, the preliminary
reading of the manufacturing purchasing managers' index rose to a
56.1 reading in January from 54.0 in December, marking a 22-month
high. .
Meanwhile, initial jobless claims dropped by 5,000 to 330,000
and remained at a five-year low. .
The leading economic index also showed positive trends, rising
0.5% in December, above analysts' estimates of a 0.4% gain. .
The upbeat data helped lift U.S. stock markets, with the S&P
500 index (SPX) briefly topping 1,500. .
Movers
Among notable movers in Europe, shares of Logitech International
SA sank 9.6%, after the computer-equipment firm said it swung to a
net loss of $195 million in the third fiscal quarter compared with
a profit of $55 million the year-ago period.
On a more upbeat note, U.K. mining firms showed upbeat moves,
after HSBC's so-called "flash" Chinese manufacturing Purchasing
Managers' Index for January climbed to a 24-month high of 51.9,
indicating activity in China's factory sector continued to
accelerate. .
Shares of Anglo American PLC gained 1.4%, while heavyweight Rio
Tinto PLC (RIO) put on 2.1%.
That helped the FTSE 100 index close 1.1% higher at 6,264.91.
.
Shares of wireless-telecom firm Vodafone Group PLC (VOD) also
added to the positive mood in London, rising 3.2%. Widely followed
hedge fund manager David Einhorn said in a letter to investors late
Wednesday that he had increased his Vodafone holdings, arguing that
the market was undervaluing the company's stake in Verizon
Wireless. .
The broader market trimmed opening losses after the Markit
composite purchasing-managers' index for the euro zone signaled the
economic downturn in the region eased in January. The index rose to
48.2 from a December reading of 47.2, beating expectations of a
47.6 print. A reading below 50 signals contraction. .
France's CAC 40 index picked up 0.7% to 3,752.17, after trading
as low as 3,711.55 earlier in the session.
Shares of LVMH Moët Hennessy Louis Vuitton gained 0.9% to 139.60
euros ($186.38). J.P. Morgan Cazenove raised the luxury-goods
maker's price target to EUR142 from EUR132 previously.
Outside the main index in Paris, shares of CGG Veritas slumped
2%, after Goldman Sachs cut the oil-services firm to sell from
neutral.
Germany's DAX 30 index put on 0.5% to 7,748.13, up from an
intraday low of 7,661.96.
Shares of Commerzbank AG gained 1.5%, as the bank confirmed
plans to cut between 4,000 and 6,000 jobs. .
Subscribe to WSJ: http://online.wsj.com?mod=djnwires