German earnings boost European stocks

European shares gained on Thursday as upbeat results from German companies offset a dour profit forecast from Nokia and a mixed bag of business sentiment indicators ahead of the European Central Bank’s October policy meeting.

The pan-European stock index rose 0.3% by 0815 GMT, on track to reach its highest level this month with German stocks driven by robust earnings from Daimler and a confirmation from chemicals giant BASF of its annual outlook.

Daimler jumped 4.7% after higher sales of its Mercedes-Benz cars boosted operating profit for the third-quarter, helping the subindex of auto stocks reach its highest since early May.

Healthcare stocks were also higher after AstraZeneca gained 3.2% on a strong set of numbers that spurred another hike in its product sales forecast.

European markets entered the third quarter earnings season this month in nervous form, with signs that Germany was heading into recession weighing on expectations for growth across the region.

ECB chief Mario Draghi holds his last meeting on Thursday after eight years at the helm with monetary policy appearing to have reached its limits for the euro area. His successor Christine Lagarde is expected to ask member governments for fiscal support to help energize growth.

On a sour note, Nokia was on track for its worst day since 2001, plummeting 21% after cutting its 2019 and 2020 profit outlook as the company faces pressure from rivals in the 5G industry. The telecom maker’s report dragged tech stocks lower for a third straight day, and weighed on Helsinkilisted stocks, which fell 2%.

Asian shares pulled ahead as corporate earnings and a ceasefire in northern Syria helped prop up sentiment, though the backdrop of trade and brexit uncertainties was enough to prevent a decisive shift towards riskier assets.

MSCI’s broadest index of AsiaPacific shares outside Japan advanced 0.3% with Japan’s Nikkei finishng up 0.55% after hitting a one-year high. Australian shares climbed 0.3%.