Europe midday: Stocks edge ahead as FTSE drags on sentiment

The pan-European Stoxx 600 index rose 0.43%, with UK stocks struggling despite a much bigger than expected jump in UK retail sales. London's FTSE 100 was down flat.

Figures released earlier by the Office for National Statistics showed that retail sales surged in April as non-essential stores reopened.

Retail sales jumped 9.2% on the month following a 5.1% increase in March and versus expectations for a 4.5% rise. The largest contribution came from non-food stores, with sales at clothing stores up 69.4%.

Compared with April 2020 - during the first national lockdown - retail sales were up 42.4%, exceeding expectations for growth of 36.8%.

Sales volumes are now 10.6% higher than in February 2020, before the impact of the coronavirus pandemic.

Investors were also digesting news from the IHS Markit survey which showed euro zone business growth accelerated at its fastest pace in over three years in May, helped by a strong resurgence in the bloc’s dominant service industry as economies reopened.

The survey also showed supply bottlenecks in manufacturing led to production problems at a growing number of factories in Germany, pushing up factory input prices at a rate never seen before in the survey’s history.

In equity news, shares in German concert promoter and ticketing company CTS Eventim gained it reaffirmed its view that the European live events market will restart in 2021 as more people were vaccinated against Covid-19 and lockdown restrictions were lifted.

Cartier maker Richemont was higher as its net profit rose by a third in fiscal year 2020/21 and it proposed to double its dividend.

German car manufacturer BMW was also higher after the company said it would have to set aside €1bn less than initially feared, for expected European antitrust fines for alleged collusion with rivals.

Lufthansa AG fell 6% as the Thiele family, the second-largest shareholder in the German airlines, sold more than half of its stake.

Trainline lost further ground after Thursday’s slump on news the UK government was planning to launch its own online rail ticketing service.

B&Q owner Kingfisher was in the red, down 3.6%, having rallied a day earlier on the back of its first-quarter update.

(Michele Maatouk also contributed to this report)