European stocks edge up as oil price slips

European shares posted their fourth straight gain yesterday, but only just, with losses in heavily-weighted oil stocks, following lower oil prices, cancelling out firmer industrials.

Siemens was a top gainer, up 1.2 per cent, as market talk flared that the German industrial giant was moving closer to a sale of its loss-making mobile phone unit.

Siemens and other chip-related firms were also helped by research firm Gartner raising its forecast for global spending on chip-making equipment this year, now foreseeing a milder decline than previously expected.

ASML was up 2.3 per cent, ahead of Q1 results from the Dutch chip-producing equipment maker on Wednesday.

The FTSEurofirst 300 index closed up 0.2 per cent at 1,103.22, after hitting 1,105.8, its highest intraday level since March 8 and close to a recent 34-month peak of 1,109.5.

While slippage in crude oil prices supported shares in heavy consumers such as British Airways, up 1.3 per cent, oil heavyweights such as BP, Total and Royal Dutch all suffered.

Royal Dutch, down 0.7 per cent, also played down talk it may buy Australia's Woodside. Meanwhile shares in BP and Total both shed one per cent, helping to drag down the DJ European Oil & Gas sector index 0.7 per cent. Analysts said the firmer tone in leading European shares this week has been underpinned by the pullback in oil prices, a more relaxed view on future US rate rises and hopes for a solid interim earnings season.

In the tech sector, Finnish mobile phone company Nokia was a top loser, dipping 1.1 per cent, as its shares traded without the right to the latest dividend payout. Rivals benefitted, with Deutsche Telekom up 0.9 per cent.

Takeover activity and talk supported selected stocks, with Boots up 3.1 per cent as a restructuring of the UK toiletries chain left it ripe for a takeover from a private equity firm, dealers said.

News of takeover talks for drinks group Allied Domecq from Pernod Ricard and the prospect of more bid action among Italian banks have also brought merger and acquisition speculation back into play.

"There's probably more to expect because the environment is as good as it has been for a long time for M&A, with interest rates low and refinancing cheap," said Rolf Elgeti, head of European equity strategy at ABN AMRO.

Monday's corporate agenda features March traffic updates from German airline Lufthansa and UK-based airport operator BAA .

Tuesday sees Q1 sales from French retailer Carrefour and annual results from British rival Tesco.