Europe midday: Shares flat as investors look for direction

European shares were flat at lunchtime on Thursday, as investors looked for direction while US futures indicated a slightly weaker opening on Wall Street.

The pan-European Stoxx 600 index was barely moving the needle as major bourses on the continent dipped in an out of positive territory.

In the UK the pound fell as Finance Minister Rishi Sunak unveiled further support measures for companies hit by new coronavirus restrictions.

Sunak said the package would help companies in regions including Liverpool and Manchester facing tighter restrictions due to rising infection numbers. Grants of up to £2100 a month would be provided to companies and that the UK would increase its share of support to furloughed employees.

The FTSE 100 was down 0.2% at 5,766.47, while sterling was 0.3% weaker versus the dollar at 1.3114 after the Bank of England’s chief economist, Andy Haldane, said negative interest rates were not on the cards anytime soon.

In equities, British Airways owner IAG reversed earlier losses despite posting a €1.3bn third quarter loss and downgrading its capacity guidance as Covid-19 restrictions continued to hammer the travel market.

Rentokil Initial rallied after it said third-quarter revenue rose thanks to "exceptional" growth in the hygiene business, which continued to benefit from high demand for disinfection services and a return to growth in pest control.

Consumer goods giant Unilever ticked higher after it reported a better-than-expected 4.4% rise in third quarter sales as people continued to buy more hygiene and food products.

Shares in French spirits maker Pernod Ricard were up as the company said sales would return to growth in the second half of its 2020/2021 fiscal year.