LONDON: European shares edged up in early trade on Wednesday, tracking Wall Street higher, as earnings reports on both sides of the Atlantic beat forecasts.
But strategists warned that issues such as the euro zone debt crisis may keep share markets rangebound.
At 0846 GMT the FTSEurofirst 300 index of top European shares was up 0.2 percent at 1,152.27 points, after rising 0.8 percent to a one-week closing high in the previous session.
The European benchmark is up more than 78 percent from its lifetime low of March, 2009, helped by the monetary easing polices of governments and central banks worldwide. However, it has recently traded in a range set by its 2011 high in mid-February and a low in mid March.
Dexia rose 4.5 percent, helped by a better than expected first-quarter performance at its retail banking operations in Belgium and Turkey, and strong performance in its asset management business.
"The corporate news has generally been very positive," said Justin Urquhart Stewart, director at Seven Investment Management. "You can see a trail of issues such as US debt, the end of QE2 (quantitative easing), sorting out the euro, but for the time being, people are enjoying a corporate spring."
"There is cash looking for a home, and M&A deals going through. We may go further on the upside in the short term, but there is increasing concern this is not going to be sustainable," he added.
German publisher Axel Springer rose 2.9 percent after reporting strong revenue growth in its first quarter thanks to its media operations abroad and its digital business.
Danish brewer Carlsberg rose 3.3 percent after meeting forecasts with a 38 percent rise in first-quarter operating profit, aided by growth in Asia and a recovery in its important East European markets.
Of the 272 STOXX Europe 600 companies due to report in the current results season 56 percent of the 190 to have already reported have beat forecasts, Thomson Reuters StarMine data showed.
Across Europe, Britain's FTSE 100 fell 0.1 percent; Germany's DAX and France's CAC40 rose 0.4 and 0.1 percent respectively.
The Thomson Reuters Peripheral Eurozone Countries Index was up 0.6 percent.
HSBC FALLS
HSBC fell 0.8 percent after Europe's biggest bank said it is reviewing its US cards business and streamlining its wealth management and retail banking operations as it eyes savings of up to $3.5 billion.
Peripheral euro zone debt issues remained a concern. Euro zone officials will debate Greece's debt crisis next week but no decision will be taken, a German deputy finance minister said on Wednesday.
"As the market implicitly prices in the higher risk of default, bond yields rise, bringing problems of solvency even more to the fore. And so it continues," said analysts at Jefferies in a note.
"Restructuring or further talk of Greece exiting EMU (which we don't expect to happen) could cause more capital to flow from the periphery to the core and other countries," they added.
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