Europe midday: Stocks flat as investors turn cautious ahead of data

European stock markets were struggling for direction on Tuesday morning with the Stoxx 600 trading broadly flat after a weak showing on Wall Street the previous session ahead of a busy few days for economic data.

"European markets remain in thrall to US equities, in particular big tech and everything directly, or even remotely, connected with generative AI," said David Morrison, senior market analyst at Trade Nation.

By lunchtime on the continent, the pan-European Stoxx 600 was up just 0.06%, as gains in Germany, France and Italy were offset by falls in the UK and Spain.

Both the Dow and S&P 500 retreated on Monday evening from the fresh record highs reached last week on the back of a blockbuster earnings report from chip giant Nvidia, with investors choosing to take profits before key macro data is released.

The macroeconomic calendar was relatively light to start the week, but a barrage of closely watched US datapoints will be on tap in the coming days, including durable goods orders, consumer confidence, GDP and manufacturing PMIs, along with the all-important personal consumption expenditures inflation gauge on Thursday.

Back in Europe on Tuesday, the German consumer sentiment index published jointly by GfK and the Nuremberg Institute for Market Decisions rose slightly heading into March, to -29.0 from a revised -29.6 the month before, and in line with expectations.

"There is great uncertainty among consumers. In addition to the constantly rising prices, the weaker economic forecasts for the German economy this year are likely to be another important reason for this," said Rolf Buerkl, consumer expert at the NIM.

Looking ahead, inflation figures from Germany will be released on Thursday, following by price data for the wider eurozone on Friday. The two publications will "provide a fresh reminder of the impending ECB pivot in the months ahead, helping to further justify the record highs habitually posted by the DAX", said chief market analyst Joshua Mahony from Scope Markets.

IBEX and FTSE fall

Madrid's IBEX 35 was trading in the red with heavy falls from stocks in the energy and transport sectors. Compania de Distribucion Integral Logista and Ferrovial were out of favour, along with Enagas, Aena, Naturgy Energy Group and Redeia.

London's FTSE 100 was also lower with heavy falls being registered by cigarette and vape producer Imperial on the back of reports that the UK government is considering a new vaping tax at the Spring Budget next week.

British speciality chemicals maker Croda International also dropped after warning of lower operating margins this year following a slump in 2023 profits due to customers destocking and a weak macroeconomic environment.