LONDON, Jan 30: European shares hovered just shy of 4-1/2 year highs on Monday, with a shake-up in the steel sector dominating for a second straight session, and as investors digested the latest batch of corporate earnings.

Steelmaker Arcelor topped gainers as investors speculated Mittal may have to raise its bid, while oil stocks also rose as crude headed towards $68 a barrel.

French drugmaker Sanofi-Aventis sank 1.5 per cent on news of an in-line earnings-per-share outlook, while Italian carmaker Fiat gained after its trading profit beat fore-casts.

The FTSEurofirst 300 index of top European shares was 0.1 per cent weaker at 1,318.41, after touching a fresh 4-1/2 year high at 1,320.90.

Sentiment is too bullish, people are running behind stocks in a speculative way. There’s a lot of M&A activity, Arcelor is still playing out, and people are looking for the next target, said Philippe Gijsels, senior equity strategist at Fortis Bank.—AFP