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Paris - European shares rose in early trade on Tuesday, reversing the previous session's dip as better-than-expected results from a number of blue-chips including pharma group Novartis and bank UBS helped lift sentiment.
Bucking the trend, shares in pharma group Sanofi sank 7.1% after posting weaker-than-expected quarterly sales, blaming pricing pressures on its lucrative diabetes business.
"This is disappointing for one of the company's most important growth engines," Berenberg analysts wrote in a note.
The sharp drop in the stock - its biggest one-day slide in five years - represented a wipeout of €7.8bn ($9.9bn) in market value of France's biggest listed company and one of Europe's largest blue-chips.
At 09:15 GMT, the FTSEurofirst 300 index of top European shares was up 0.8% at 1 315.00 points, reversing a 0.6% fall on Monday.
Shares in UBS rose 3.5% after the bank beat forecasts with a 32% rise in net profit from a year earlier, even after including a charge of 1.8bn Swiss francs ($1.9bn) as it discusses a settlement to an investigation that it and other banks rigged foreign exchange rates.
Swiss pharma Novartis gained 2.5% after reporting better-than-expected results, while Dutch telecoms group KPN rose 3.3% after posting forecast-beating results as the pace of revenue decline at its consumer mobile and business units slowed.
Finnish pulp and paper maker UPM-Kymmene jumped 8.1% after posting a bigger-than-expected rise in quarterly core profit on the back of cost cuts, and said it was planning more savings to boost profitability amid a weak European economy.
On the downside, Asia-focused bank Standard Chartered tumbled 8.4% after it said it will cut branches and sell more non-core assets as part of a plan to cut costs by $400m next year.
About a quarter of companies listed on the STOXX Europe 600 benchmark index have reported results so far in the earnings season, with 66% of them meeting or beating profit forecasts, and 61% meeting or beating revenue forecasts, according to Thomson Reuters Starmine data.
In absolute terms, European companies have posted a 12.6% rise in quarterly earnings, and a 1.9% rise in revenue. This compares with a rise of 6.7% in S&P 500 profits and 4.8% rise in revenue for the quarter, Starmine data shows.
Alexandre Baradez, chief market analyst at IG France, said there's hope for the positive trend in European profits seen so far in the earnings season to extend in the coming quarters when the impact from the lower euro and the fall in commodity prices kick in.
"The dovish tone by the ECB and all the measures unveiled have pushed the euro down from $1.40 to $1.25 and this will give European companies big leverage in the coming months."
Around Europe on Tuesday, UK's FTSE 100 index was up 0.4%, Germany's DAX index up 1.3%, and France's CAC 40 up 0.3%.
Italy's MIB was up 1.5% while Spain's IBEX was up 1.3%, recovering after sharp losses on Monday. The eurozone's blue-chip Euro STOXX 50 index was up 0.9% at 3 027.58 points.
The Greek market was closed for a national holiday on Tuesday.
