LONDON (AFP) – European shares edged higher on Thursday after British and eurozone interest rates were left unchanged, as expected, and news of soaring first-half profits at lenders Barclays and Commerzbank.
Investors were meanwhile in a cautious mood on the eve of crucial US non-farm payrolls data, with data coming through showing a sharp jump in jobless claims.
London's FTSE 100 index of top shares rose 0.24 percent to 5,399.02 points in early afternoon deals, Frankfurt's DAX 30 was up 0.58 percent to 6,368.75 points and in Paris the CAC 40 index added 0.90 percent to 3,795.10.
The Stoxx 50 index of top eurozone shares advanced 0.58 percent to 2,841.57 points.
The European Central Bank opted on Thursday to keep its main interest rate at a record low of 1.0 percent as traders awaited the post-decision press conference from ECB President Jean-Claude Trichet.
The Bank of England kept its benchmark rate at 0.50 percent -- also an all-time low -- despite a recent upturn in British economic growth.
"European markets are unfazed by the rates decisions which came in as expected," CMC Markets analyst Michael Hewson told AFP.
"Trichet's press conference may throw up some other variable, with respect to the ECB's views on future growth forecasts in Europe," he said, adding: "Markets (are) still focussing on earnings ahead of tomorrow's key US payrolls data."
In Frankfurt, Commerzbank shares fell 0.50 percent to 7.15 euros despite news that the German bank swung back into profit in the second quarter of the year -- and predicted it would end 2010 with a profit as well.
In London, Barclays slid 4.16 percent to 325.9 pence despite news that net earnings jumped 29 percent in the first half of 2010 on the back of strong investment bank profits and tumbling bad debts.
The results are another sign of revival by the banking sector, severely hit during the economic crisis, and follow other strong results at other banks this week.
The numbers, however, got a mixed reaction from the stock market, according to City Index analyst Joshua Raymond.
"Company results have failed to invigorate the markets today, with earnings from Barclays and Commerzbank not enough to inspire investors to add more risk to their portfolios.
"Having seen a number of banks already outperform earnings consensus, expectations are fairly high -- meaning that only a bumper set of profits were going to inspire investors to build on their bank gains."
The top winner in London was insurance group Aviva, jumping 7.53 percent to 395.6 pence.
The company said operating profits soared 21 percent in the first half, lifted by a recovery in sales in some countries in Asia and Europe, and expressed confidence over the outlook.
Asia-Pacific stocks edged higher on Thursday, relieved by a rise in the dollar in New York following positive US economic data.
Tokyo gained ground, adding 1.73 percent, while Hong Kong finished flat.
Wall Street climbed 0.41 percent on Wednesday after stronger-than-expected employment and service sector reports lifted investor sentiment.