European shares rise for 5th session

European shares closed slightly higher yesterday, gaining for the fifth consecutive session, with rises in the banking sector overshadowing falls in miners as copper prices slipped.

The pan-European FTSEurofirst 300 index of top shares closed up 0.1 per cent at 1,036.44 points after earlier being as low as 1,028.77 and as high as 1,040.50. Banks added the most points to the index. Banco Santander, UBS, BBVA and Barclays were up 1-2.2 per cent.

Across Europe, the FTSE 100 index slipped 0.1 per cent, Germany's DAX was down 0.4 percent and France's CAC 40 was 0.4 per cent lower.

"We are trying to break out on the upside, but every time we make the move then we get a setback and go back down," said Giuseppe-Guido Amato, strategist at Lang & Schwarz in Frankfurt.

"We are moving sideways ... and are searching for a new trigger to break out on the upside." Earlier, investor sentiment had weighed after contracts for pending sales of previously owned US homes unexpectedly fell in January, a survey showed. The market had initially been given a boost after the number of US jobless claims fell in the latest week and productivity data was stronger than initially thought in the fourth-quarter.

Construction stocks were in demand. Vinci rose 2.6 per cent after it said late Wednesday it expected margins to remain stable this year as it posted forecast-beating full-year results, helped by lower financing costs.

Dutch grocer Ahold gained 4.8 per cent after it unveiled plans to return €500 million to investors, raising hopes it can cope with weak consumer demand that hit quarterly earnings and will not overspend on acquisitions.

Miners featured among the worst performers on the back of weaker copper prices as investors worried demand was cooling in China and dollar strength deterred non-US investors.

BHP Billiton, Eurasian Natural Resources, Rio Tinto and Xstrata eased one to 1.9 per cent.

Utility stocks were weaker. GDF Suez lost 2.7 after it cut its key profit target as sharply lower gas prices capped the world's second-biggest listed utility's core earnings growth at one per cent in 2009.

Anheuser-Busch InBev slipped 3.5 per cent after it said it faced a challenging start to 2010 with US consumers drinking less, after it unveiled mixed fourth-quarter earnings buoyed by a sharp rise in Brazil sales.

Back to economic news, European Central Bank President Jean-Claude Trichet unveiled the next step in stimulus withdrawal, and said the ECB is returning to ordinary tenders for three - month loans for banks from April.