Europe midday: GDP figures stop shares from sliding amid Covid concerns

European stocks were flat at lunchtime on Friday as strong eurozone GDP figures halted a sell-off against a backdrop of Covid-19 second wave concerns and lower US futures.

The pan-European Stoxx 600 wavered between gains and losses. The German DAX was down 0.46% and the French CAC 40 rose 0.11%, while the UK FTSE 100 index was 0.3% lower.

Stronger-than-expected third quarter GDP figures provided some positive impetus. France, Italy, Germany and Spain all saw quarter-on-quarter growth beating analysts’ expectations.

The eurozone economy grew a record 12.7% in the third quarter, according to flash figures released by Eurostat on Friday, but another downturn is expected as governments across Europe bring back tighter Covid-19 restrictions.

This marked the strongest growth on record following an 11.8% contraction in the previous quarter, which was hit by Covid-19 lockdowns. The figure was also ahead of analysts’ expectations for growth of 9.4%.

Growth for the European Union came in at 12.1% compared to an 11.4% contraction in the second quarter.

Wall Street futures fell, with the Dow down 295 points as earnings after the bell from Apple and Amazon failed to impress investors.

“US markets finished on a much more positive note yesterday on optimism that last night's waterfall of tech earnings after the bell would help continue a stabilisation in sentiment, after what has been a brutal week for equity markets in general,” said CMC markets analyst Michael Hewson.

“This proved to be a false hope, despite some by and large fairly decent numbers. Amazon for example blew the doors in terms of profits, making more money in the first nine months of the year, than the whole of 2019, while also adding over 400,000 jobs since the beginning of 2020.”

“This comes across as nit-picking somewhat, given Amazon estimates for Q4 sales, were even higher than their record breaking Q3, but nonetheless we’ve seen tech stocks in Asia also rollover after Apple sales of iPhones fell short in their Q4 numbers.”

In equity news Ubisoft shares fell 6.5% after the computer games maker announced delays for its Far Cry 6 and Rainbow 6 Quarantine releases.

Shares of Air France-KLM fell after the airline swung to a heavy net loss in its third quarter, as it cut its capacity views and warned that it would see significantly lower earnings for the last three months of the year.

Shares in Belgian telephone, internet and television service provider Proximus rose after the firm upgraded its full-year guidance, citing a good response to its launch of flexible packages in July.

The new offer, which allows customers to create their own packages of mobile, internet and TV services, lifted the company's client base excluding pre-pay customers by 3.7% year on year.

Natwest shares were up almost 5% after the state-owned lender produced forecast-busting profits for the third quarter and cut bad debt provisions.

Royal Dutch Shell was boosted by an upgrade to ‘equalweight’ at Barclays.