Europe midday: Stocks decline amid disappointing earnings as investors eye US data

European stocks fell, weighed by some disappointing corporate results as investors digested a hawkish policy statement from the Federal Reserve and looked ahead to some key US data releases.

At midday, the benchmark Stoxx Europe 600 was down 0.5%, Germany’s DAX was 0.4% lower and France’s CAC was down 0.9%.

The Fed stood pat on interest rates on Wednesday, but the accompanying statement suggested a rate hike in December may be on the cards.

“The FOMC left the door ajar. If markets don’t tighten financial conditions for them, if the US data remain firm, if global events don’t scare them and if the sun shines every day, the Fed will raise rates at their December meeting,” said Societe Generale strategist Kit Juckes.

“All those caveats leave the market pricing the odds of a move at close to 50%, and the focus switches immediately to data-watching. Today that means jobless claims and 3Q GDP.”

Corporate news was mostly downbeat on Thursday.

Barclays was in the red after it posted a drop in third-quarter pre-tax profit as the cost of claims settlements weighed on results and revenues fell. The company paid out £560m in compensation to customers who had been missold foreign exchange products and to settle claims over US mortgage-backed securities.

Deutsche Bank fell sharply after the company announced plans to cut up to 35,000 jobs over the next two years, as it posted a €6bn loss for the third quarter and said it will scrap its 2015 and 2016 dividends.

Smith & Nephew dropped after its third-quarter revenue came in a little weaker than expected, although the maker of artificial hips and knees maintained its full-year guidance and announced the acquisition of robotics company Blue Belt Technologies.

Royal Dutch Shell slipped after the company slumped to a third-quarter loss of $6.1bn (£4bn), with earnings well short of forecasts.

BT Group was also on the back foot after posting a drop in second-quarter operating profit.

On the upside, UK insurer Aviva advanced after saying the value of its new business rose 25% in the first nine months of the year to £823m marking the eleventh consecutive quarter of growth.

The macroeconomic front was a little cheerier.

Earlier, figures released by the Federal Labour Agency showed German unemployment declined more than expected in October, while the unemployment rate remained unchanged at 6.4% - its lowest level since reunification.

Elsewhere, data from the European Commission showed business confidence in the Eurozone came in better than expected in October.

Later in the session, investors will eye a batch of US data, with initial jobless claims and the first release of third-quarter GDP due at 1230 GMT, and pending home sales at 1400 GMT.