European shares level off at 27-month high

European shares level off at 27-month high

London: European shares were flat in thin pre-Christmas trade on Thursday after hitting a 27-month high for a fourth day, with stronger drugmakers on a jump in Novo Nordisk shares offsetting miners that tracked weaker metals.

Danish company Novo Nordisk rose 3.3% after the company overnight announced positive results from Phase III trials with its new-generation insulin Degludec. The STOXX 600 European healthcare index rose 0.5%.

But miners slipped as key base metals prices eased on profit taking. The European basic resources index fell 0.8%, while Antofagasta was down 0.6%.

At 2:49pm, the FTSEurofirst 300 index of top European shares was little changed at 1,148.06 points after rising earlier to 1,149.05, the highest level since the collapse of investment bank Lehman Brothers more than two years ago.

The index is up 10% this year after rising 26% in 2009 and analysts said the market’s outlook stayed positive.

“The corporate picture still looks very bright, the trend towards higher profits is going to continue and public policies should remain shareholder-friendly," said Henk Potts, equity strategist at Barclays Wealth.

“In terms of macro environment, we would expect most of the economies to keep growing and that is a pretty powerful mix of positivity."

Investors are due to get a batch of US economic figures later in the session, including November durable goods and the weekly jobless claims, as well as November new home sales data.

“Today’s releases for the US economy are likely to reinforce the market perception that growth in the US economy is well grounded," Davy said in a note.

Among individual movers, Scandinavian airline SAS jumped 10%, with traders citing a report that Lufthansa planned a takeover of SAS. Lufthansa and SAS declined to comment on the report.

Swedish specialty steelmaker SSAB fell 3.5% after saying its operating profit for the fourth quarter had been hit by weak shipments and production problems and would probably be close to zero.

Anglo-Australian miner Rio Tinto was down 1.2% after the company offered $3.9 billion to buy African-focused coal miner Riversdale in an agreed deal that is expected to be challenged by rivals seeking to secure coking coal reserves.

Across Europe, Britain’s FTSE 100 and Germany’s DAX gained 0.1%, while France’s CAC 40 was down 0.2%. The Thomson Reuters Peripheral Eurozone Countries Index was up 0.3%.

“The market has delivered a solid rally over the course of the past two weeks. The problem is you may find a little bit of indigestion going into the new year. But in the longer term, the outlook still remains quite positive," Potts said.