At 1034 GMT, the FTSEurofirst 300 index of top European shares increased by 0.9 percent, bringing its gains for the year to 5.3 percent. While this year's performance falls short of the 14 percent gains seen at this time in 2006, European shares have rebounded by 9.5 percent from a low point in August when concerns over credit market instability were at their peak. France Telecom saw a 6.5 percent surge in its shares following strong results, which also lifted Vodafone by 4 percent, making telecoms the best performing sector in Europe. ABB, a Swiss engineering group, experienced a 3.7 percent rise after an 86 percent increase in quarterly earnings driven by high demand for power generation infrastructure. Additionally, French competitor Alstom saw a 5.6 percent increase in its stock price after Lehman Brothers raised its target price for the company. While expectations for earnings growth to slow this quarter have been widespread after a period of strong performance, many companies have reported robust numbers. Gerhard Schwarz, head of global equity strategy at Unicredit in Munich, stated that the earnings season could reassure investors, with results exceeding expectations and having a positive impact on sentiment. However, there is a noticeable trend of increased selectivity, and it is premature to assume that earnings growth in Europe will slow down less than in the United States. Daimler, a German auto group, reported third-quarter earnings that surpassed forecasts, resulting in a 1.5 percent increase in its stock. In terms of macroeconomics, U.S. durable goods orders and a reading on U.S. new home sales are expected later in the day, with financial markets already factoring in a 100 percent probability of a cut in U.S. interest rates next week. Additionally, data from the Ifo economic research institute showed that its German business climate index decreased in October, aligning with market expectations. In European markets, the FTSE 100 in London, DAX in Frankfurt, and CAC-40 in Paris all increased by more than 1 percent. European stocks have been on a rollercoaster ride, recovering after a 13 percent drop in one month starting from mid-July, thanks to reductions in the Federal Reserve's discount and main funds rates. However, the recovery has been impacted by negative news about banks' exposure to credit market issues, with the European benchmark falling one week for every week it has gained in the past 14 weeks since mid-August. U.S. stocks bounced back on Wednesday amid talks of a possible cut in the discount rate by the Federal Reserve. Market speculation about another easing move by the Fed has increased due to concerns about downside earnings surprises and credit market problems. The merger and acquisitions trend, which has been a major factor in the stock market's positive performance over the past few years, continued to drive up stock prices. French electrical supplier Rexel saw an 8.5 percent increase in its shares after announcing plans to divide Dutch competitor Hagemeyer with privately held Sonepar, causing Hagemeyer's shares to drop by 3.3 percent. Generali's stock rose by 5.7 percent, following a 2.6 percent increase the previous day, after British fund Algebris criticized the Italian insurer's corporate governance and called for changes. Spanish bank Santander also saw a 1.6 percent increase in its stock price as the company's nine-month net profit exceeded market expectations.