Europe midday: Equities push lower as investors await non-farm payrolls

European stocks were in the red as investors digested disappointing German data and opted for caution ahead of the eagerly-awaited non-farm payrolls report.

At midday, the benchmark Stoxx Europe 600 index was down 0.7%, France’s CAC 40 was down 0.8% and Germany’s DAX was 0.2% lower.

“The first Friday of the month once again sees traders’ attention dominated by US non-farm payrolls,” said Alastair McCaig, market analyst at IG.

“This time last month the data dashed Janet Yellen’s hopes of raising interest rates before the end of the year as the headline figure, the revision and the average hourly earnings all undershot expectations. For the first time in 18 months expectations are below 200,000, a reflection of how dented optimism is after last month.”

Investors will be particularly keen to see how the October payrolls report comes in after Federal Reserve Chairwoman Janet Yellen’s hawkish comments on Wednesday.

Yellen said before the House financial services committee that the US economy was performing well and a rate hike next month was still a “live possibility”.

"The committee does feel that moving in a timely fashion if the data and outlook justify such a move is a prudent thing to do because we will be able to move at a more gradual and measured pace," Yellen said.

Some bad news on the macroeconomic front also put a downer on the mood.

Figures released by Destatis earlier showed German industrial output fell by 1.1% month-on-month on a seasonally-adjusted basis in September. This marked the sharpest drop in over a year and fell well short of expectations for a 0.5% increase.

In corporate news, German insurer Allianz slumped after reporting a bigger-than-expected 15% drop in third-quarter net profit.

BHP Billiton was under the cosh after a dam burst at an iron ore mine in Brazil part-owned by the company, leaving at least 15 people dead and almost 50 missing.

Compagnie Financiere Richemont tumbled after the Cartier owner posted first-half profit and sales that fell short of analysts’ expectations, while French drug maker Sanofi slid after it warned that it may not see any profit growth for two years.

On the upside, Swiss agribusiness Syngenta surged on reports it was in discussions over a combination with DuPont’s agricultural division.

Inmarsat was in the black after the satellite telecommunications service provider posted a jump in third-quarter profit.

The payrolls report is at 1330 GMT, along with the unemployment rate.