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The biggest one-day drop in AstraZeneca shares following a drug study failure dominated trading in Europe on Thursday though a handful of well-received corporate results helped broader indexes nudge higher.
The British drugmaker fell 15 per cent to its lowest level in almost five months after a closely watched advanced lung cancer trial failed, in what Morgan Stanley said was a “major setback" for the group.
Regional healthcare stocks fell 1.1 per cent to their lowest in more than four months but solid results from big firms, including Swiss drugmaker Roche, beer maker AB InBev and Diageo, underpinned gains on broad indexes.
The pan-European STOXX 600 index added 0.1 per cent higher and euro zone bluechips rose 0.4 per cent, while German's DAX fell 0.4 per cent as results from BASF and Deutsche Bank underwhelmed.
“Markets overall are flat as earnings are pretty mixed today,” AFS Group analyst Jauke de Jong.
Diageo , up 6 percent, provided the biggest boost to the STOXX after the maker of Johnnie Walker whisky and Smirnoff vodka raised its profitability target and announced a share buyback programme.
Roche gained 1.2 per cent after it raised its 2017 outlook while AB InBev , up 5.5 per cent, reported an increase in second-quarter earnings.
Thursday will see the heaviest day of European earnings in the current earnings season and by the end of the week about half the market-cap of STOXX 600 will have reported earnings.
As of the previous day's close, a quarter of the companies on the MSCI Europe had issued results with nearly half of them beating profit expectations and 8 percent matching them. Results point to aggregate second-quarter earnings growth of 11 percent.
Elsewhere, French firms Elior Group and Imerys were the worst performers on the STOXX 600 after AstraZeneca after respective results.
Among large companies, Nestle results also disappointed. Its shares fell 1.5 per cent after the world's largest food group trimmed its 2017 sales outlook, adding fuel to shareholder demands on CEO Mark Schneider to speed up a turnaround.
“It shows you that CEO Mark Schneider has a lot of work to do and there isn't a magic wand in terms of getting the top line going,” said Jon Cox from Kepler Cheuvreux.
Siemens Gamesa fell 15 percent after third quarter net profit missed analyst expectations.
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