European shares traded flat by midday on Thursday, with BT Group up more than 4 percent on the back of robust results while Barclays fell after refusing to rule out a rights issue, according to Reuters. Stock markets pared early losses after data showed stronger-than-expected economic growth in the 15-nation euro zone in the first quarter, led by investment. A rise in U.S. stock index futures underpinned the market recovery. At 1055 GMT, the FTSEurofirst 300 index of top European shares was up 0.03 percent at 1,355.16 points, having fallen as much as 0.8 percent earlier. Shares in BT Group rose 4.1 percent after Chief Executive Ben Verwaayen signed off his last set of results with figures which beat revenue forecasts and met earnings targets, and with a prediction of more growth in 2009. "This is a strong quarter with revenues ahead of expectation and cash flow in line despite more capex investment. Operational trends are generally robust," Dresdner Kleinwort said in a note. "Given that consensus expects 1.5 percent EBITDA growth next year, and the company has just delivered 2 percent growth, we expect this to support EBITDA estimates for 2009," Morgan Stanley said. Zurich Financial Services Group shares rose 3.7 percent after the company, Europe's fourth-largest insurer, beat expectations with a 3 percent rise in first-quarter net profit. "These are undoubtedly a strong set of results," Collins Stewart said in a note, describing Zurich Financial as a "well managed, cash-generative safe haven." Other winners included Vivendi, Europe's largest entertainment group, up 5.2 percent after the company posted a smaller-than-expected drop in first-quarter operating profit and forecast full-year profit growth similar to 2007. "We expect strong quarters ahead," JPMorgan said in a note. Barclays was Europe's leading blue-chip loser, down 3.2 percent. The British bank said profits fell by an undisclosed amount in the first quarter and it refused to rule out a rights issue after taking a net 1 billion pound ($1.95 billion) hit from assets tarnished by the credit crunch.
