European Shares Poised to Post Best Week Since April


European shares remained buoyed by central banks' commitment to ongoing stimulus on Friday, heading for their best week since late April, with Invensys and Swedish Match boosted by M&A talk.

By 1025 GMT, the FTSEurofirst 300 was up 6.20 points, or 0.5 percent at 1,203.06, on course for its best weekly performance in 11 weeks.

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Stocks have been underpinned by the U.S. Federal Reserve's hints this week that it may not be as eager to phase out its support as markets had started to believe, echoing recent dovish comments by the European Central Bank and Bank of England.

"It is a win-win situation (for investors). If the economic data does start to pick up, it will be a gradual tapering of QE and if it does not, then they will keep the liquidity tap on," said Chris Bates, analyst at Smith and Williamson.

The FTSEurofirst 300 closed at a five-week high on Thursday, climbing for a fourth straight session and breaking above its 100-day moving average to pave the way for more gains.

Markit said implied volatility averaged 17.65 percent over the first half of 2013, compared to 24.67 percent year-on-year in 2012, implying a brighter picture for 2013.

Industrial automation company Invensys jumped 15.4 percent after France's Schneider Electric said it was in early talks to buy the UK firm for about 3.3 billion pounds ($5 billion). Schneider was down 3.7 percent.

Swedish Match gained 2.5 percent, with traders citing a media report that the tobacco firm could be the subject of a possible 350 Swedish crown per share bid from Imperial Tobacco, the world's no. 4 cigarette maker.

Reckitt Benckiser slipped 3.7 percent, its biggest fall since May 2011, after a U.S. healthcare provider dropped the higher-margin version of one of its drugs from its list of medicines, leading Credit Suisse to cut its target stock price.

European banks rose after U.S. investment bank JP Morgan's second-quarter results beat expectations.

Deutsche Bank said in a note it expects aggregate company earnings to stabilise and support equity valuations in the second-half of 2013.