Mixed results weigh on Europe shares; Sandvik slips
European shares fell early onFriday in choppy trade, as question marks over some corporateearnings and weaker financials offset gains made on the back ofrallying oil stocks and upbeat telecoms. At 0856 GMT, the FTSEurofirst 300 index was down0.3 percent at 1,563.15 points, having risen more than 1 percenton Thursday when more weak U.S. data raised the prospects of astock-friendly U.S. rate cut next week. Swedish engineering group Sandvik fell 7 percentafter posting poor quarterly results, while Ahold dropped 4.7 percent after the Dutch supermarket group said its revamp of stores in the United States would continue to hurtmargins. Swedish bank SEB fell nearly 3.4 percent after itsthird-quarter operating profit came in just below marketconsensus after taking a hit in fixed income from recent creditmarket upheavel. Elsewhere in the sector Unicredit fell 2.1 percenton vague talk that Munich Re was selling the smallstake it owns in the Italian bank. Munich Re declined tocomment. "The earnings season -- some good, some bad. Generallyspeaking I think the market is focusing a lot on earnings riskand you can see that with some of the price moves," said PhilipIsherwood, strategist at Dresdner Kleinwort. Oil stocks benefited from rising prices, with U.S. crudehitting a record at above $92 a barrel. BP was up 1.3percent, Royal Dutch Shell gained 1.5 percent and Total rose 1.4 percent. U.S. Reuters/ University of Michigan Surveys of Consumersrelease the final October consumer sentiment index at 1400 GMT. Analysts said U.S. markets continued to be unpredictable. "We've seen some pretty volatile days in the U.S. this week... So I think there's a little bit of caution in terms of whatare you going to see from the U.S.," said Isherwood. British drugmaker GlaxoSmithKline fell 1.7 percent,the top-weighted loser on the index, taken down by recentdowngrades after poor results and the weakness in the dollar. OTHER SIDE OF THE EARNINGS COIN Several companies reported robust results, underlininganalysts' views that earnings growth in Europe is becomingincreasingly selective. Shares in Nordic telecom leader Telia Sonera climbed 4.7 percent in their largest daily rally since May 2006after beating expectations with third-quarter core earnings andannoucing plans to return more than $1.5 billion toshareholders. This comes a day after France Telecom's sharesjumped nearly 9 percent on strong results. Auto stocks also roared on robust results. Shares in PSA Peugeot Citroen gained nearly 4.4percent after the French car maker posted a 12 percent rise inthird-quarter sales, beating market expectations. Shares in rival Renault SA surged 3 percent afterNissan Motor Co , in which Renault has a 44 percentstake, reported a surprise 12 percent gain in quarterlyoperating profit. Volkswagen rose 0.1 percent after posting a near50 percent gain in nine-month operating profit thanks toresurgent earnings at its core VW brand after the world's fourthlargest carmaker cut thousands of job cuts last year. The biggest percentage gainer of the pan-European index wasPortuguese bank Millennium bcp , up nearly 6 percentafter a source close to a Millennium shareholder said the bank'schairman has backed a merger proposal from smaller rival BPI and has begun urging shareholders to accept the deal.