European companies have enjoyed their strongest quarter for four years and an improving economic backdrop and a supportive euro currency should ensure that they maintain their momentum. 

With more than four fifths of companies in the STOXX Europe 600 index now having reported first quarter results, StarMine data show that 61% have met or beaten forecasts. 

Their earnings have grown by 7% from the same quarter in 2014. 

Telecoms, discretionary consumer goods and energy sectors were among the top performers, with more than 70% of those companies meeting or beating analyst predictions in the first three months of the year. 

European companies' earnings per share (EPS) are likely to grow by 5.4% this year compared to a rise of 4.6% predicted in early March, according to Thomson Reuters. 

Some analysts said the number was likely to go even higher and that forecasts were not fully reflecting the positive trend. 

Although there is some nervousness due to a 7% rise in the euro against the dollar since the middle of April and a 27% recovery in oil prices over the last two months, analysts said the region's brighter economic outlook and improved margins would be the main influences on earnings. 

They added that action by the European Central Bank was also starting to have a positive effect on the economy. 

The ECB earlier this year announced plans to buy €60 billion of bonds a month from March in a programme to run to September 2016 and boost the region's economy. 

Data this week showed the euro zone grew at its strongest rate since the second quarter of 2013, while France's economy expanded at its fastest pace in two years. 

There are some signs that investors are gradually becoming more positive on the earnings prospects. 

The number of analyst upgrades have overtaken downgrades for the first time this year, with 52% of analysts upgrading their EPS forecasts for 2015, compared to 28% at the start of the year.