Europe midday: Stocks slip as ECB chief strikes more confident note
A more confident tone from European Central Bank chief Mario Draghi and a profit warning from a German auto parts maker combined to send stocks lower across the Continent.
At 1200 BST, the benchmark Stoxx 600 was 0.47% or 1.83 points lower at 387.28, while the German Dax was down by 0.38% or 48.88 points to 12,721.95 and the Cac-40 was on its backfoot, slipping 0.51% or 27.46 points to 5,268.15.
"Draghi suggested inflation is becoming more sustainable and deflationary forces have been replaced by reflationary forces.
"The question is whether the Eurozone would survive without the QE support. Draghi sounded more circumspect on that front, arguing that he is confident that monetary policy is working but still needs to remain very loose," said Neil Wilson, senior market analyst at ETX Capital.
Banks were outperforming with the Stoxx 600 gauge of lenders' shares up by 0.51% to 180.07 as Draghi's remarks saw 10-year German bund yields snap higher by seven basis points to 0.31%.
Delivering the introductory speech at the European Central Bank's forum in Sintra, Portugal Draghi said inflation in the euro area was being dragged down by "transitory" factors.
The single currency also got a boost in its cross against the US dollar, jumping 0.75% to 1.1267.
The day before, Draghi had highlighted to a group of university students in Portugal how youth unemployment was still "very high" with the ECB's 'price stability' mandate having yet to be met as well.
Going in the other direction, a profit warning from the German manufacturer of bearings for use in the automotive and aerospace industries, Schaeffler drove the Stoxx 600 subindex of Auto and parts manufacturers down by 1.05% to 549.61.
Acting as a backdrop, speaking at the World Economic Forum Chinese premier Li Keqiang said China was able of achieving the government's target for 6.5% growth in gross domestic product in 2017, while keeping systemic risks under control.
ISTAT's Italian consumer confidence index jumped from 105.4 in May to 106.4 for June, boosted by stronger readings in all its subcomponents.
A separate index tracking the business climate in the euro area's third largest economy increased from 106.2 in the month before to 106.4 for June.
Later in the day, the focus would be on speeches from four top US central bank officials, including chair Janet Yellen herself at 1800 BST.
Before that, at 1500 BST, the Conference Board would publish its consumer confidence barometre for the month of June.
Credit rating agency Moody's said Intesa Sanpaolo's acquisition of the goods assets of Banca Veneto and Banca Popolare di Vicenza.
Meanwhile, in Spain, recently rescued lender Bankia took over Banco Mare Nostrum in all-shares deal valuing the latter at €825m.
Shares in Stada plummeted on news that private equity groups Bain Capital and Cinven failed to win the requisite amount of shareholder acceptances.