The number of firms reporting results gathers steam next week with British giants BP, Vodafone and GlaxoSmithKline dominating, but these are unlikely to move European bourses out of their rut.
"Many people would have expected the markets to move higher but there has been so much nervousness and that comes mainly from the US earnings, the oil price rise and the shift in interest rate expectations," said Patrick Schowitz, European strategist at HSBC.
The FTSE Eurotop 300 index sank this week to within 7 points of its 2004 lows around 952 and by 1410 GMT on Friday it stood at 965 points.
Analysts agree markets are cheap but said investors continue to worry about high oil prices combined with US economic data which hints at a slowdown - symptoms of stagflation.
"There's not enough of a signal to be bearish. But your oil price is important - it effects consumer and corporate spending, the economic pick up could come under pressure and earnings slow," said Walter Kemmsies of J.P. Morgan.
The world's second largest oil group, BP, the largest mobile phone operator Vodafone, and Europe's biggest drug-maker GlaxoSmithKline all report quarter results early in the week.
Analysts said BP should post near record results driven by oil prices, which hit an all time high last month due to supply concerns.
Anglo-Dutch oil group Royal/Dutch Shell will also report second quarter results, their second sets of earnings after the group revealed in January it had overstated its oil reserves by a fifth.
Investors are expecting a solid performance from Vodafone on Monday, with good first quarter customer growth and customer revenue though they will focus on its struggling Japanese unit, which is expected to show one of its worst quarters on record as it loses high-paying clients.
GlaxoSmithKline is expected to report a sharp drop in earnings, hurt by generic competition in the antidepressant market and negative currency factors.
The company has already warned 2004 will be a tough year and investors will be looking for signs that GSK can start to register earnings growth again in the final quarter of the year.
German industrial conglomerate Siemens will report third quarter results on Thursday and investors are already well attuned to troubles at its handset and rail divisions, setting conservative expectations.
Instead, they will be trying to find out more about the financial costs and benefits of Siemens' merger of its fixed-lines telecom unit ICN with mobile telephone unit ICM.
Swiss reinsurer Converium, reporting first half results on Tuesday, will be in focus after the firm warned this week of a deep second quarter loss and said it might tap shareholders for cash to replenish funds drained by US claims.
The warning, given on Tuesday, wiped out over $1 billion off Converium's market value as shaken investors sold off their shares, pushing the stock down 50 percent.
Investors will also get a last peek at the health of Franco-German drug-maker Aventis in its first half results, before it is taken over by smaller rival Sanofi-Synthelabo. The 52.7-billion-euro deal, due to be wrapped up at the end of next week, will make Sanofi the world's third largest drug-maker.
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