European shares up on firm miners; Bernanke in focus

* FTSEurofirst 300 up 0.4 percent, near six-month high

* Miners top the gainers list as metals prices advance

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Atul Prakash

LONDON, Oct 25 (BestGrowthStock) – European shares rose on Monday to
hover just below last week’s six-month highs, led by miners
after a jump in metals prices on dollar weakeness and with an
upgrade for Volkswagen boosting automakers.

At 1122 GMT, the FTSEurofirst 300 (.FTEU3: ) index of top
European shares was up 0.4 percent at 1,093.44 to trade near
Thursday’s 1,096.31, the highest since late April.

Miners surged, with the STOXX Europe Basic Resources index
(.SXPP: ) rising 2.1 percent, as copper hit a 27-month high on
falling stocks, strong demand in China and after the dollar fell
as the G20 agreement to shun competitive currency devaluations
was taken as a green light to resume dollar selling.

“They struggled to come out with an accord that changes
anything practically,” said Henk Potts, equity strategist at
Barclays Wealth, referring to the G20 meeting.

“There is still a potential risk of competitive currency
devaluations, which is a major problem and potentially the first
step on the road that leads to protectionism. The market still
remains concerned, but surely it looks as if they are at least
trying to agree at core understanding, which is helpful.”

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For more on the G20 meeting, click on [ID:nTOE69K01G]

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Most base and precious metals advanced on the fall in the
dollar, making metals cheaper for holders of other currencies
and helping shares in BHP Billiton (BLT.L: ), Anglo American
(AAL.L: ), Antofagasta (ANTO.L: ), Rio Tinto (RIO.L: ), Xstrata
(XTA.L: ) and ENRC (ENRC.L: ) — up 2 percent to 4.3 percent.

“Profitability and earnings are going to be up. This is a
sector that will have earnings upgrades. Even if the dollar
started to steady, there are supply constraints,” Philip
Isherwood, European equities strategist at Evolution Securities,
said, referring to the mining sector.

Automakers gained, led higher by Volkswagen (VOWG_p.DE: )
which rose 5.6 percent, after Credit Suisse hiked its share
price target to 130 euros from 102, reiterating its “overweight”
rating, following results on Friday. [ID:nLDE69O0FR]

“Unlike other players, VW has come out of the biggest
economic crisis without losing money in a single quarter,”
Credit Suisse said in a note. [ID:nLDE69L1KA]

BMW (BMWG.DE: ), Daimler AG (DAIGn.DE: ), Peugeot (PEUP.PA: ),
Renault (RENA.PA: ), Fiat (FIA.MI: ) were up 1 percent to 2.5
percent.

SENTIMENT IMPROVES

Data showing euro zone industrial new orders stronger than
expected in monthly terms in August, hopes of further
quantitative easing by the U.S., strong company results, and
merger and acquisition news also improved market sentiment.

London Stock Exchange (LSE.L: ) and Frankfurt stock market
operator Deutsche Boerse (DB1Gn.DE: ) rose 5.1 percent and 1
percent respectively after Singapore Exchange’s (SGXL.SI: ) A$8.4
billion ($8.2 billion) takeover bid for ASX Ltd (ASX.AX: )
signalled industry consolidation may heat up again.

TeliaSonera (TLSN.ST: ) gained 2.2 percent after raising its
2010 outlook when posting a higher than expected quarterly
profit thanks to smartphone usage at home and economic recovery
in emerging markets. [ID:nSAT008855]

“The third-quarter reporting season has been very strong,
with majority of companies exceeding analysts’ expectations and
that continues to be a very supportive theme,” Potts said.

“The outlook from companies still remains relatively
positive as well. Obviously, the authorities’ efforts to secure
recovery through quantitative easing has also seen as positive
for macroeconomic backdrop given the weakness that you have seen
more recently,” he said.

The market awaited a speech by U.S. Federal Reserve chairman
Ben Bernanke at 1230 GMT for indications whether he was leaning
toward aggressive quantitative easing or a moderate approach.
(Additional reporting by Brian Gorman; Editing by Dan Lalor))

European shares up on firm miners; Bernanke in focus