London - European shares edged higher on Tuesday, supported by mergers and acquisitions activity in the telecoms equipment sector after Nokia entered talks to buy Alcatel-Lucent.
The announcement came as something of a surprise as reports had suggested Nokia may be interested in Alcatel's mobile networks arm rather than the entire firm.
Alcatel-Lucent was up 10.7 percent while Nokia fell 7.4 percent. Peer Ericsson was up 1.6 percent while Dutch listed telecoms firm Altice rose 2.2 percent, also helped by a target hike at ING.
“Buying... their wireless business would have been very suitable,” said Mikko Ervasti, an analyst at Evli Bank, who rates Nokia a sell.
“It now appears it's about the whole company and also includes units that are of non-core nature so that is slightly concerning.”
Alcatel and Nokia were, respectively, the top riser and top faller on the pan-European FTSEurofirst 300 index, which was up 0.2 percent at 1,650.740 points at 08h02 GMT, having hit its highest level since 2000 at 1,651.37 points earlier in the session.
The FTSEurofirst was supported by gains in materials stocks, which rebounded as copper bottomed out, with investors betting that China would take fresh measures to shore up its economy after surprisingly weak trade data on Monday.
Elsewhere, Swiss logistics company Kuehne Und Nagel fell 2.8 percent after reporting flat earnings before interest and taxes in the first quarter of the year.
Shipping and oil firm AP Moller-Maersk, a supplier of Kuehne Nagel, fell 2.2 percent.
Reuters