Europe midday: Stocks slightly weaker after disappointing German factory data

European stocks were a touch weaker on Tuesday following weaker-than-expected German manufacturing data.

At midday, the benchmark Stoxx Europe 600 index was down 0.1% to 372.89, Germany’s DAX was flat at 11,967.22 and France’s CAC 40 fell 0.28% to 4,958.35.

Meanwhile, Brent crude was up 0.19% to $56.12 per barrel and West Texas Intermediate was 0.3% firmer at $53.36.

In currency markets, the euro was flat against the dollar at 1.0575 and up 0.29% versus the pound at 0.86731.

On the data front, eurozone gross domestic product growth for the fourth quarter was confirmed at 0.4% thanks to a rebound in investment spending. Seasonally-adjusted GDP was up 0.4% in the bloc compared to the previous quarter and 1.7% from the fourth quarter of the previous year. Both figures were in line with estimates and consensus.

In the EU-28 group of nations, GDP was up 0.5% compared with the previous quarter and 1.9% from the fourth quarter of 2016. Over the course of 2016, GDP rose by 1.7% in the euro bloc and 1.9% in the EU-28.

German factory orders dropped 7.4% in January, the biggest fall since 2009, from a 5.2% rise the previous month. This was more than the 2.5% fall predicted by economists. Domestic orders fell 10.5% and foreign orders were down 4.9%.

Compared to last year, orders fell 0.8% adjusted for the number of working days in each month, but were up 5.1% not adjusted.

Investors were also concerned with upcoming elections in the Netherlands on 15 March, in France in April and May, and in Germany in September.

Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “In France, the election shenanigans dent the appetite in the financial markets. Alain Juppé said he would not run for the election, as a scandal hit hard Francois Fillon’s campaign. Left with Fillon only, the French right camp could lose more blood. The question is who between Emmanuel Macron and Marine Le Pen would be more susceptible to catch undecided UMP voters?

“Despite a softer open in the European markets this morning, we remind that the overall sentiment remains positive. European stocks are trending higher on the back of higher global growth prospects and perhaps expectations that some British businesses could decide to move toward the mainland Europe after the Brexit. Dip buyers could find opportunities to strengthen their long positions. Cheaper euro could further increase the appeal of the European stocks.”

In corporate news, Casino Guichard dropped 5.46% despite posting 2016 net profits of €2.67m largely due to the sale of its Asia operations.

Temporary power provider Aggreko slumped 11.39% after reporting a 3% drop in full-year underlying earnings amid a gloomy outlook for 2017.

BHP Billiton was up 0.93% after talk of Chile’s presidential hopeful urging striking miners to refuse a poor contract offer, while other miners were in the spotlight as base metals diverge on digestion of slower China growth outlook.

Newly merged bookmaker Paddy Power Betfair was down 5.01% after saying its new financial year has started in line with expectations, as it reported a 35% rise in underlying earnings before interest, tax, depreciation and amortisation to £400m.