Europe midday: Stocks recover from early falls as markets digest latest moves by Russia

European shares erased earlier sharp losses triggered by Russia's unexpected decision to recognise two breakaway republics in Ukraine's Donbass region and send in "peacekeepers".

Helping stocks recover their footing were reports that the European Union and US would foist sanctions on Moscow, but not of the calibre that had been planned in case of a further invasion of Ukraine, and Russia was not planning to recognise separatists' claims on land not currently in their possession.

Against that backdrop, as of 1227 GMT, the pan-European STOXX 600 index was edging up by 0.01% to 454.86, alongside a 0.05% dip on the German Dax to 14,728.45.

Moscow's RTS index nevertheless remained lower, by 2.05% to 1,182.73, but was trading far above its lows of the session and with the dollar lower against the rouble alongside.

However, German Chancellor Olaf Scholz responded to the latest moves by the Kremlin by announcing that he would halt certification of the Nordstream 2 gas pipeline.

Furthermore, some western officials continued to warn that the risk of an invasion still existed.

In equity news, medical equipment manufacturer Smith & Nephew rose as full-year operating profits doubled in 2021, partly driven by a solid performance in its sports medicine and ENT and advanced wound management units.

Shares in financial services company Hargreaves Lansdown tanked as it revealed profits had fallen during the first half of its 2022 trading year on the back of a reduction in share-dealing revenues.