Europe close: Stocks end on mixed note ahead of central banks

European stocks ended on a mixed note, as investors looked ahead to rate announcements from the Bank of Japan and the Federal Reserve on Wednesday.

The benchmark Stoxx Europe 600 index drifted 0.08% lower, Germany’s DAX was up 0.19% and France’s CAC 40 was 0.13% lower.

Meanwhile, oil prices eased back as hopes receded that Russia and OPEC could agree a deal to freeze production. West Texas Intermediate was down 0.5% at $43.66.

The Federal Reserve’s two-day policy meeting kicks off on Tuesday with a decision due on Wednesday, along with the BoJ’s.

Andy McLevey, head of dealing at stockbroker Interactive Investor, said: “European markets nudged easier in subdued early trading as crude gave up the gains of yesterday and investors adopt a wait-and-see approach ahead of the central bank meetings this week.

"With little on the corporate earnings front to tempt investors out of their cautious malaise all eyes remain focussed on Wednesday's announcements from the Fed and Bank of Japan.”

In corporate news, Bayer gained ground after lifting sales targets for its top-selling drugs.

B&Q and Screwfix owner Kingfisher traded higher after it nailed an encouraging increase in first half profits and confirmed early progress in chief executive Véronique Laury's ambitious turnaround project.

Water utility and waste management company Pennon Group was in the black as it said it is on track to meet expectations for the 2017 financial year as its portfolio of energy recovery facilities remains on course to meet its target.

Sports Direct nudged up as it agreed to undertake an independent review of its working practices and corporate governance.

Pharmaceutical giant GlaxoSmithKline was weaker after announcing that Emma Walmsley - the current chief executive of the company’s consumer healthcare division - is to be appointed CEO designate, and will succeed Andrew Witty as CEO when he retires on 31 March 2017.

FTSE 250 spreadbetting firm IG Group fell sharply after saying it performed well in the three months to the end of August in what was a challenging quarter, but reporting a drop in UK & Ireland revenue as markets became increasingly subdued after Brexit.

On the macroeconomic front, figures from Destatis showed German producer prices fell more than expected in August.

Producer prices for industrial products fell 0.1% from July, versus expectations for a flat reading. On the year, prices were down 1.6%, which was steeper than the 1.5% drop expected by economists.

Energy prices were the biggest drag, down 5.5% from the same month last year, while prices of intermediate goods fell by 1.6%.

Prices of non-durable consumer goods rose by 0.7%, prices of capital goods by 0.6% and prices of durable consumer goods by 1.2%.

Excluding energy, the overall index declined by 0.3% compared to August last year and was unchanged from July.