Buoyant earnings spur European stock gains

European stocks notched up moderate gains yesterday, boosted by a batch of upbeat corporate earnings, a day after interest rate worries threatened their bull run.

Indexes pared gains towards the close, tracking a slide on Wall Street, after investors were rattled by Iran saying it would not suspend its atomic work.

The FTSEurofirst 300 index of top European shares closed unofficially up 0.4 per cent at 1,540.2, after dipping in the previous session as higher-than-expected US inflation figures raised the prospect of interest rate rises.

The United Nations' nuclear watchdog earlier said Iran had ignored a Security Council deadline to halt work the West fears could lead to Tehran building an atomic weapon.

Around Europe, Britain's FTSE 100 gained 0.4 per cent, while Germany's DAX added 0.5 per cent and France's CAC 40 rose 0.2 per cent.

Chemical makers ranked among the biggest gainers as BASF jumped 5.4 per cent after healthy results, while Nestle climbed 2.9 per cent after the world's largest food group topped its own sales growth target.

European shares rose strongly by midday yesterday as a robust set of company results reassured investors a day after interest rate worries threatened to crimp a bull run in stock markets.