Europe open: Stocks drift lower as investors await Fed minutes

European stocks drifted a little lower in early trade as investors awaited the release of the latest Federal Open Market Committee minutes.

At 0900 BST, the benchmark Stoxx Europe 600 index was down 0.1%, Germany’s DAX was 0.4% weaker and France’s CAC 40 was off 0.3%.

At the same time, oil prices retreated. West Texas Intermediate was down 0.8% to $46.21 a barrel and Brent crude was off 0.9% to $48.78.

With no major eurozone data releases due, market participants will be turning their attention to the Federal Reserve minutes as they look for clues on the timing of an interest rate hike.

Rebecca O’Keeffe, head of investment at Interactive Investor, said: “European equities are treading water in early trade, as the market awaits the minutes of the last Federal Reserve meeting, released this evening. With the market still ultra-reliant on central bank support, the report is a key indicator for investors, who will be hoping that the doves remain in control.

“With a rate chance in September being priced at just 22%, there remains a significant disconnect in expectations between the market and some Fed members meaning that if the Fed pulls the trigger sooner than expected, market reaction could be sharp and swift.”

In corporate news, Carlsberg was under pressure after the brewer’s half-year results fell short of expectations, although it maintained its outlook for the year.

Insurer Admiral was sharply lower amid concerns about the group’s Solvency II position, after it lifted its interim dividend by almost a quarter and posted a jump in profits for the first half.

On the upside, ABN Amro racked up healthy gains following better-than-expected second-quarter results.

Aerospace and defence group Cobham rallied after announcing that chief executive officer Bob Murphy will step down from his role by the end of 2016 to pursue other opportunities and will be succeeded by David Lockwood no later than 1 January 2017.

FTSE 250 construction group Balfour Beatty surged after it reinstated its dividend as it reported a smaller loss for the half year ended 1 July.