LONDON (Reuters) - European shares opened slightly higher on Wednesday as a flurry of fresh third-quarter results came in, though politics kept Spanish equities in negative territory.
The pan-European STOXX 600 <.stoxx> index was up 0.2 percent with all sectors trading in positive territory.
After opening in line with other bourses, Madrid's IBEX
eased back with a 0.3 percent slide. Catalonia and Spain's central government seem set for political collision after the region refused to give up a symbolic declaration of independence. Spanish shares, particularly banks, have underperformed their European peers on the back of Spain's worst political crisis in 35 years. Caixabank , Sabadell and BBVA with around one-third of their total deposits coming from the region, were retreating 1 percent, 0.9 percent and 0.6 percent respectively. In a first sign that a short-term business exodus from the restive region may become more permanent, Sabadell is considering moving some of its top management to Madrid, a source close to the board said on Tuesday.On the wider European corporate earnings front, companies failing to meet market expectations saw their shares come under pressure. The biggest STOXX fallers included Finnish telco Elisa , Germany's Duerr and Zalando as well as Dutch paints maker Akzo Nobel which lost 4.4 percent, 2.9 percent, 2 percent and 1.7 percent respectively. The UK's Reckitt Benckiser was flat after initial losses after the maker of Durex condoms said it would split into two business units after a third-quarter fall in sales prompted it to cut its full-year forecast. In the banking sector, Sweden's Handelsbanken reported third-quarter operating profit slightly above market expectations, boosted by higher than expected income from core lending activities and rose 0.3 percent.Sainsbury's , Britain's second biggest supermarket fell 1.1 percent after it said it aimed to cut up to 2,000 jobs. European third quarter earnings are expected to grow by 4.5 percent from the same period in 2016, which would be an increase of 1.3 percent excluding the energy sector, according to Thomson Reuters I/B/E/S estimates. (Reporting by Julien Ponthus, Editing by Kit Rees and Richard Balmforth)
