* FTSEurofirst 300 up 0.5 percent
* Cyclical miners, autos extend gains
* Dividend concerns hit telecoms sector
By Tricia Wright
LONDON, Nov 2 European shares rose on Friday
after a forecast-beating U.S. jobs report, although near-term
index moves were likely to be subdued until the outcome of the
U.S. presidential election is known, traders said.
Miners and autos, considered cyclicals as
they are heavily exposed to the economic cycle, rose 0.8 percent
and 1.2 percent respectively, building on Thursday's strong
gains after better economic data in China and the United States.
The FTSEurofirst 300 closed up 0.5 percent at
1,115.19, taking its weekly rise to 1.6 percent, though it ended
off a session peak of 1,118.10 hit after the U.S. jobs data.
U.S. employers added 171,000 people to their payrolls last
month, outpacing forecasts, while 84,000 more jobs were created
in August and September than initially estimated. Other U.S.
data was mixed.
The jobs figures, the last before the U.S. presidential
election on Tuesday, could lift President Barack Obama's chances
at the ballot box, though polls still indicate a close race
between Obama and the Republican candidate, Mitt Romney.
"They're good numbers... but for the U.S. economy to get
back to the level it was in terms of employment in 2008, you
need jobs growth of plus 200,000 per month," Michael Hewson,
senior markets analyst at CMC Markets, said.
"Upside is still going to remain limited ahead of next
week's election - there's still a bit of uncertainty ahead of
that... and obviously as to how much damage there will be from
Telecoms were the hardest hit sector on Friday, off
0.4 percent after a media report that Deutsche Telekom
is considering cutting its dividend by up to a third
The news further eroded sentiment towards a sector once
loved for its high dividends in the wake of payout reductions by
peers like France Telecom and Telefonica.
A 15 percent drop in revenues in Europe pushed telecom
equipment market Alcatel towards a bigger than
expected third quarter loss, knocking 5.5 percent off the share
price on Friday.
With the third quarter earnings season half way through, 44
percent of companies in developed Europe have missed forecasts
and the remainder are expected to undershoot by on average 1.6
percent, according to Thomson Reuters Starmine data.
"U.S. and European equities are caught a little bit in the
headwinds of lower marginal earnings in terms of outlook for
earnings and lower actual earnings from the last quarter," Saxo
Bank Chief Investment Officer Steen Jakobsen said.
"The balance sheet recovery is in great shape but to expect
them to continue to improve the balance sheet is probably
The euro zone's blue-chip Euro STOXX 50 was up
0.5 percent at 2,547.15, after a 1.2-percent gain in the
Some technical analysts see little reason to become overly
optimistic even as the index has recent range highs within its
"I'm still pretty cautious because it hasn't broken out
yet," Phil Roberts, technical strategist at Barclays, said.
"The minimum you've got to take out is 2,580 (the peak of
mid-October), but then you've got the high of 2,611 (March 2012)
just above that - then you can get a little bit more expansive."