(by Mark Riley)

Good earnings reports helped european markets to close higher.

The FTSE Eurotop 300 added a further 1.2 per cent to 980.68, its third consecutive gain, and has now risen 2.4 per cent since hitting a year’s low on Monday.

The electrical and heavy engineering sector was among the prime movers behind the Eurotop’s latest advance and was accompanied towards the top end of the sector winners’ list by the oil and gas, computer, steel and mining sectors as well as both of the insurance areas, general and life.

Switzerland’s ABB group was one of the best of the top sector’s performers, its shares climbing 3.9 per cent to SFr6.70 after the company posted its biggest quarterly profits for two years - SFr86m compared with $55m in the same period last year - and an acceleration in sales.

And Siemens also staged a powerful showing that drove its shares up 4.7 per cent to €57.13 in the wake of sharply higher quarterly sales and bumper new orders.

Adding to a bullish overall picture for the company was the statement from its chief executive, Heinrich von Pierer, that Siemens should beat its full-year goal of increasing earnings by at least 10 per cent.

Meanwhile, Ericsson, the Swedish telecoms equipment manufacturer, maintained its recent advance, the shares adding a further 3 per cent to SKr20.70, bolstered by a target price increase issued by Credit Suisse First Boston.

The broker increased its earnings per share estimates by 9 per cent and 5 per cent for 2004 and 2005 to SKr1.36 and SKr1.55 pre-goodwill respectively, based on higher sales and profit margins, and maintained its outperform rating.

ASML, the Dutch chip equipment manufacturer, featured prominently in the winners’ list, its shares moving up to settle 4.3 per cent higher at €11.64, pushed ahead after bullish results from Taiwan Semiconductors, the world’s biggest contract microchip manufacturer, which said its quarterly profits doubled to a record high.

In the banks, Depfa, which lends to local governments and is scheduled to announce second-quarter results on Tuesday, rose 4.2 per cent to €11.29 after Deutsche Bank recommended it and Commerzbank ahead of the second-quarter results season. "Stick to the banks that delivered good results in the first quarter," Deutsche said. Commerzbank shares rose 1.9 per cent to €14.16.