Europe close: Stocks fall ahead of Nvidia earnings, economic data

European stock markets finished off their lows on Tuesday following a late-afternoon rally but were still firmly in the red as investors turned cautious ahead of Nvidia's earnings and economic data later in the week.

Europe's Stoxx 600 finished down 0.18% at 522.95, rebounding after hitting a low of 520.71 earlier on. The benchmark has traded within a tight range of less than five points since 10 May, hitting an all-time closing high of 524.71 last Wednesday.

Tuesday's session was relatively quiet, with little in terms of economic data to influence trading, though things will pick up in the coming days, with inflation figures due out from the UK on Wednesday and PMI surveys from the UK, eurozone and US all due on Thursday.

Meanwhile, chipmaker Nvidia, which will report its quarterly results on Wednesday, is largely seen as the posterchild for the massive surge in US equity markets so far this year, as investors continue to pour into names in the AI space. However, with markets both side of the Pond trading at or close to record highs, investors were choosing to take profits on Tuesday.

"Today provides markets with their final chance to position themselves ahead of tomorrow’s pre-open release of earnings from Nvidia, with the tech giant providing perhaps the final major hurdle to overcome for first quarter earnings season," said Joshua Mahony, chief market analyst at Scope Markets.

"With big tech spending more than ever in a bid to gain a dominant position in the AI space, there is a hope that these purchases will be recurring and not front-loaded in nature. For investors, there is a desire to see strong growth, but also confidence that the pace of expansion will continue for a long time yet."

Eurozone construction figures and German producer prices were the only major economic data releases of the day. Construction output in the eurozone rose by just 0.1% month-on-month across the single-currency region in March, after a revised 0.4% increase in February, revised down from the initial estimate of 1.8%; while German wholesale prices fell at an annual rate of 3.3% last month, after a 2.9% decline in March, lower than the consensus forecast for a year-on-year fall of 3.2%.

Market movers

France's CAC 40 was underperforming the rest of Europe by dropping 0.7%, with chipmaker STMicroelectronics heading lower ahead of Nvidia's results.

Paris-listed carmakers Renault and Stellantis were also lower, falling in sympathy with Germany counterparts BMW and VW after a report from the Senate Finance Committee that claimed the latter two companies and Jaguar used a supplier that has links to forced labour in China.

Italian insurance and asset management provider Assicurazioni Generali declined in Milan despite beating forecasts with its first-quarter results, as analysts expressed disappointment with results from its non-life business.

AstraZeneca gained in London after unveiling medium-term growth targets to nearly double group revenues by the end of the decade as it predicts significant growth from existing oncology, biopharmaceuticals and rare disease portfolios. The pharma giant said it expects to total revenues to hit $80bn by 2030, compared with $45.8bn in 2023.

Greencore Group's share price surged 18% after the UK convenience food manufacturer reported a huge jump in first-half profits and launched a share buyback programme as it guided to full-year earnings ahead of market forecasts.