Europe midday: Stocks waver as central bank meetings eyed

European stocks wavered on Tuesday with jitters creeping in ahead of this week’s central bank meetings, as investors digested earnings from oil heavyweights BP and Shell and encouraging Chinese manufacturing figures.

At midday, the benchmark Stoxx Europe 600 index was down 0.2%, while Germany’s DAX and France’s CAC 40 were both 0.1% lower. Stocks had kicked off the session in the black following the release of better-than-expected readings on Chinese manufacturing.

China’s official manufacturing purchasing managers’ index increased to 51.2 in October from 50.4 the month before. A reading above 50 indicates expansion.

Meanwhile, the Caixin manufacturing PMI edged up to 51.2 in October from 50.1 in September. Both readings beat forecasts.

Meanwhile, oil prices were mixed. West Texas Intermediate was down 0.2% to $46.75 a barrel and Brent crude was 0.3% firmer at $48.76.

Investors were likely to be cautious ahead of rate decisions from the Federal Reserve and the Bank of England on Wednesday and Thursday, respectively.

Earlier, both the Bank of Japan and the Reserve Bank of Australia stood pat on their monetary policies.

IG’s Joshua Mahony said: “Overnight announcements from the BoJ and RBA saw two of the four central bank decisions this week err on the side of caution. In much the same way as we expect the Fed to remain steady on rates, with the election uncertainty looming, the same story goes for everyone else, with the outcome sure to significantly alter the state of play for currencies, bonds, commodities and stock valuations.”

On the corporate front, the energy sector was in focus as oil giants BP and Shell reported their earnings.

BP was under the cosh after it said underlying third-quarter profits halved compared to last year, although the fall was not as bad as feared.

However, Royal Dutch Shell fared a lot better, racking up solid gains as its third-quarter profits beat analysts’ expectations.

Tyre maker Nokian rallied after posting a 2% rise in third-quarter operating profit while consumer goods group Orkla was also in the black after reporting better-than-expected core operating profit for the third quarter.

Moneysupermarket surged as it said it was on track to meet forecasts for a record year after a resurge in insurance offset a flat period for credit card and loan switching in the third quarter.

Asia-focused Standard Chartered slumped after the bank swung to a third-quarter profit, but the numbers missed analysts’ expectations. In the quarter ended 30 September, underlying pre-tax profit came in at $458m from a $139m loss in the same period a year ago, but it was below the $520m analysts had pencilled in.

Danish jewellery brand Pandora was on the back foot despite reiterating its full-year revenue guidance and reporting an increase in third-quarter profit.

There are no major eurozone data releases due, but in the US construction spending and ISM manufacturing are at 1400 GMT.