Europe midday: Dip for euro, company results buoy stocks

European stocks were holding higher as a dip in the single currency and positive company updates helped to lift some of the selling pressure on equity markets, amid talk that the European Central Bank might not be as near as some may have thought to tinkering with its guidance.

As of 1230 BST, the benchmark Stoxx 600 was 0.38% or 1.44 points higher to 384.02 while Germany's Dax was up 0.12% or 14.77 points at 12,445.37 and France's Cac-40 ahead by 0.25% or 12.75 points to 5,185.97.

In parallel, euro/dollar was down 0.27% to 1.1524.

According to a sourced-report from Bloomberg the day before the Governing Council's next policy meeting, staff at the ECB were examining alternative scenarios for the future path of the central bank's bond purchase programme.

Nevertheless, the fact that such studies were being carried out did not mean a change in stimulus was imminent. No formal discussions about an end to so-called quantitative easing had yet taken place and the same sources told the newswire that officials had "limited" appetite for any significant change in policy.

Commenting on the outlook for Thursday's ECB decision, Michael Hewson, chief market analyst at CMC Markets UK, said: "President Draghi will certainly have his work cut out in keeping a lid on the euro at this rate, as the market gears up for tomorrow’s ECB rate meeting, with a move to the 1.2000 level a distinct possibility on a break of 1.1620 and last year’s high.

"While the economic outlook has improved in Europe markets are now betting it is only a matter of when the ECB starts preparing the ground for a slow retreat from its stimulus program."

In the background, ECB Governing Council member Francois Villeroy de Galhau reportedly said on Wednesday morning there was still a need for accommodative monetary policy.

Euro area construction output declined by 0.7% month-on-month in May, according to Eurostat, following a small rise of 0.3% in April.

Still ahead for later in the day was the National Association of Realtors's US housing starts figures for June, followed by a reading on Belgian consumer confidence for July at 1400 BST.

Electrolux was a top-gainer after management provided more upbeat forecasts for North America alongside the company's second quarter numbers.

US private equity groups Bain Capital and Cinven tabled a fresh takeover bid for Stada.

Germany's Daimler said it would invest €220m to upgrade over three million Mercedes-Benz diesel engine cars.

Akzo Nobel boss Ton Buechner resigned for health reasons.

Carrefour's Brazilian unit priced its shares at the lower end of the expected range ahead of its upcoming flotation.

A top executive at Spain's Iberdrola told Reuters his company was planning to enter the Italian retail electricity market by year-end.