Europe midday: Shares hold gains as Philips soars 42% on payout news

European shares opened higher on Monday as investors eyed central bank rate decisions this week, while shares in Philips and Atos were in focus.

The pan-regional Stoxx 600 index was up 0.28% at 509.39. The US Federal Reserve will make a rate announcement on Wednesday after another higher-than-expected inflation reading last Friday. Analysts expect no change from the central bank.

Britain's FTSE 100 was up 0.6% at 8,186.35, having hit a fresh intraday high of 8189 earlier.

"The FTSE 100 leads the pack once again this morning, with the UK bourse finding itself in fresh territory once again. A day devoid of major data in the US instead sees the focus lie on European inflation data out of Spain and Germany," said Market Scope analyst Joshua Mahony.

"Unfortunately, the recent inflationary theme seen throughout much of the developed world looks likely to come into play once again, with the Spanish monthly figure of 0.7% meaning that we have seen a sum total of 1.5% price growth over March and April alone."

"While we await the German reading, the greater than expected figures from North Rhine-Westphalia and Bavaria (the top two economic regions) do signal a potential higher than expected figure for Germany later in the day."

"Unfortunately, the data we have seen over recent months does call into question the legitimacy of calls for a June rate cut from the ECB, with tomorrows wider eurozone CPI figure likely to be a major driver of volatility if it dampens easing expectations that have reached a somewhat lofty 72%."

In economic news, sentiment took a hit across both the eurozone and the wider EU in April, according to survey data released on Monday, alongside a downturn in employment expectations.

The European Commission’s Economic Sentiment Indicator (ESI) saw a slight decrease in both the EU - down 0.3 points to 96.2 - and the euro area - down 0.6 points to 95.6.

Similarly, the Employment Expectations Indicator (EEI) experienced a more pronounced decline in both regions, down 0.5 points to 101.7 in the EU and off 0.7 points to 101.8 in the common currency area.

Despite the declines, however, the EEI remained above its long-term average.

In equity news, shares in Philips surged by more than 42% as the Dutch medical devices maker said it had agreed to pay $1.1bn in a settlement over a ventilator recall - much less than original market fears of $2-3bn.

France’s Atos rose 18% at the open after confirming the French government had made an offer for three strategically important parts of the business, advanced computing, critical systems and cyber products.

JD Sports Fashion was down after Barclays cut its rating to 'equal weight' from 'overweight' and reduced that target price to 140p from 165p.

Deutsche Bank fell as the German lender said it would take a hit from a legal provision over a litigation regarding its takeover of Postbank.

Reporting by Frank Prenesti for Sharecast.com