Europe open: Stocks waver ahead of ECB announcement

European stocks wavered in a tight range in early trade as investors sifted through earnings and looked to the latest policy announcement from the European Central Bank.

At 0845 BST, the benchmark Stoxx Europe 600 index was down 0.2%, Germany’s DAX was up 0.1% and France’s CAC 40 was flat.

Meanwhile, oil prices retreated following a strong rally in the previous session after data from the US Energy Information Administration showed a surprise 5.2m drawdown in crude inventories to 468.7m barrels last week and amid growing expectations of an OPEC-led production cut.

West Texas Intermediate was down 1% to $51.07 a barrel and Brent crude was off 0.8% at $52.25.

In corporate news, Deutsche Lufthansa flew higher after upping its profit target for the year on the back of better-than-expected business bookings.

Switzerland’s Roche nudged a touch higher as it reported a 3% rise in third-quarter sales and confirmed its outlook for 2016.

London Stock Exchange advanced after it reported a rise in income and revenue for the three months to the end of September.

Rio Tinto edged up despite lowering its iron ore shipment guidance slightly after it fell 5% the third quarter, reduced by port and rail maintenance.

Swiss food and drinks group Nestle fell after cutting its outlook for the year amid falling food prices.

French advertising agency Publicis lost ground as its third-quarter sales growth missed analysts’ expectations.

Anglo-Swiss miner Glencore ticked lower after announcing plans to sell its rail coal haulage business in the New South Wales Hunter Valley for $1.14bn to Genesee & Wyoming Australia.

As far the ECB announcement is concerned, no change to policy is expected. However, investors will be looking to see if President Mario Draghi gives any hints about quantitative easing as the current programme is set to end in March next year and there have been reports of tapering.

Societe Generale said: “For today’s ECB meeting, we expect no policy action, a dovish tone and lots of questions on tapering. While an extension of QE beyond March 2017 today cannot be ruled out, disagreement over an exit scenario will likely push decisions to December.

“As regards which purchase limit to soften, we maintain our view that raising the issue limit to 50% is the most likely option in December.”

The ECB rate announcement is at 1245 BST. In the US, initial jobless claims and the Philadelphia Fed survey are at 1330 BST, while leading indicators and existing home sales are at 1500 BST.