Europe close: Stocks take a breather

European stocks were mixed on Wednesday, as investors paused for breath following the best daily performance in nearly a year.during the previous session.

The Europe Stoxx 600 Index was up 0.15% at 453.16, having surged 1.97% on Tuesday on the back of easing bond yields in the US, even as hopes rose of further stimulus in China.

Markets were higher in Frankfurt, Madrid and Milan, but lower in Paris, with the latter registering heavy losses on the back of weakness in the luxury sector.

In economic news on Wednesday, German inflation fell to its lowest level since the start of the war in Ukraine.

The annual change in the consumer price index stood at +4.5% in September, down from +6.1% in August and +6.2% in July. Energy prices rose just 1% year-on-year, slowing from the 8.3% growth seen the previous month.

LVMH leads luxury stocks lower

LVMH dropped 7% after the luxury group said organic revenue growth had eased to 9% in the third quarter, well below the 11.2% growth expected by analysts. Sales in the wines and spirits division, in particular, plunged 14%, causing shares in fellow drinks company Pernod Ricard to fall.

"While luxury has been a strong sector lately, given that customers with high disposable incomes are relatively sheltered from cost-of-living pressures, results from LVMH, the first in the sector, appears to suggest that the blockbuster period for luxury is starting to fade," said Victoria Scholar, head of investment at Interactive Investor.

Others in the sector, such as Kering and Hermes, also took a hit in Paris trading.

On the other hand, Danish pharma giant Novo Nordisk rose strongly after calling an end to a trial of its Ozempic drug after early signs of success. The trial, studying Ozempic's treatment of kidney failure in diabetes patients, was supposed to continue for nearly a year longer.