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European Factors to Watch-Shares seen opening slightly higher

Reuters - January 13th, 2014

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LONDON Jan 13 (Reuters) - European shares headed for a slightly firmer open near a 5-1/2-year high on Monday, tracking gains in some key Asian and U.S. indexes, with investors' focus shifting to company earnings after a poor U.S. jobs report.

U.S. employers hired the fewest workers in nearly three years last month, data showed on Friday, but market reaction was mixed, as concerns about weakness in the world's biggest economy were balanced against the possibility that further reductions in U.S. stimulus may be postponed.

">LONDON Jan 13 (Reuters) - European shares headed for a slightly firmer open near a 5-1/2-year high on Monday, tracking gains in some key Asian and U.S"Analysts also said unusually cold weather may have had an impact on the data.

In the absence of a clear market direction, investors will keep an eye on the fourth-quarter earnings season, with a slew of major U.S. companies like JPMorgan, Citigroup and Goldman Sachs announcing results this week. European earnings will gather pace in the last week of the month.

"We're still stuck in a very unusual environment in which investors can't decide what is actually more beneficial for the stock markets - positive fundamentals or more quantitative easing," Alpari analyst Craig Erlam said in a note. "That may change in the coming weeks though as companies begin reporting fourth quarter earnings. If investors want to see the equity market rally continue, company fundamentals will have to improve."

Financials will be in focus after global banking regulators agreed on Sunday to ease the way a new rule, meant to rein in risky balance sheets from 2018, is compiled to try to avoid crimping financing for the world's economy.

At 0732 GMT, futures for the Euro STOXX 50, Britain's FTSE 100 , Germany's DAX and France's CAC were 0.2 to 0.3 percent higher.

The pan-European FTSEurofirst 300 index closed 0.4 percent higher at 1,321.16 points on Friday after setting a new high since mid-2008, while in the U.S.

market, the S&P 500 and the Nasdaq added 0.2 percent and 0.4 percent respectively.

The euro zone's blue chip Euro STOXX 50 index climbed 0.4 percent to 3,104.15 points on Friday, with charts pointing to some more gains in the near term.

"The Euro STOXX 50 is still stuck in a range that has been in place since November, where it has struggled to achieve a meaningful break above 3,100," Bill McNamara, technical analyst at Charles Stanley, said.

"However, the fact that it is lodged near the top end of the range looks positive and a break higher remains a realistic near-term expectations, with 3,175 being the next upside target." ------------------------------------------------------------------------------ > Shares mostly firmer, gold gains as dollar skids > S&P ends up, led by defensive stocks; earnings in play > U.S. bonds rally on weak U.S. jobs data > Dollar hits near 1-mth low vs yen after weak US jobs data > Gold rallies to highest in a month as U.S. jobs growth slows > LME nickel jumps on Indonesian ore export b > Brent falls toward $107 on Iran nuclear deal

COMPANY NEWS

SUEDZUCKER

German sugar refiner Suedzucker affirmed its full-year outlook for a slide in profit after reporting a 28 percent decline in third-quarter operating profit amid lower sugar prices.

VEOLIA

Veolia Environnement said on Monday it had won a contract worth 320 million euros to build a desalination plant in Kuwait.

SANOFI

The French drugmaker will buy a 12 percent stake in Alnylam Pharmaceuticals Inc for $700 million and deepen their partnership to develop drugs for rare genetic diseases.

DEBENHAMS, SPORTS DIRECT

Sports Direct has acquired a 4.63 percent steak in Debenhams, saying it wishes to explore options to work together at an operational level and intends to be a supportive shareholder.

AMEC

The British engineer unveils a possible cash and shares offer for Swiss-based rival Foster Wheeler.

TOTAL

Total confirmed on Monday that it had acquired a 40 percent stake in two shale gas exploration licences in the United Kingdom.

MORRISON

The British grocer, under pressure since posting worse-than-expected Christmas sales, is set to face calls from a U.S. activist investor to shake-up its property portfolio, reports the Financial Times.

AIRBUS

After increasing sales of its A320 jet by revamping it with newer and more efficient engines, Airbus is studying whether to repeat the process with a larger jet, the A330, industry sources and analysts said.

CONTINENTAL

The automotive supplier is confident for 2014 after reaching its increased financial 2013 targets, Chief Executive Elmar Degenhart told Handelsblatt.

ALCATEL LUCENT

France's industry minister pressed struggling telecoms company Alcatel-Lucent on Friday to cut fewer jobs as part of a restructuring aimed at stemming years of losses.

Separately, Alcatel-Lucent is in talks with three potential buyers for its business that sells telecom equipment and services to corporations with a decision on the sale expected by March, according to a Bloomberg report.

KPN

Shareholders of Dutch telecoms group KPN on Friday approved the withdrawal of preference shares which gave an independent foundation the power to fend off a bid by Mexican group America Movil.

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