Europe midday: Stocks underpinned by German business confidence, miners

At midday, the benchmark Stoxx Europe 600 index and France’s CAC 40 were up 0.2%, while Germany’s DAX was 0.4% higher.

Meanwhile, oil prices advanced, with West Texas Intermediate up 0.7% to $50.86 a barrel and Brent crude 0.5% stronger at $51.71.

The mood was underpinned by the latest survey from the Ifo Institute, which showed German business sentiment hit a two and a half year high in October. The Ifo’s business climate index rose to 110.5 from 109.5 in September, reaching its highest level since April 2014 and beating expectations for a small drop.

The assessment of current conditions edged up to 115.0 from 114.7, and the forward-looking expectations index increased to a two-year high of 106.1 from 104.5.

Pantheon Macroeconomics said: “These are strong data, and suggest that the German economy started Q4 on a very strong note. Indeed, if we continue to see these numbers, it would suggest that GDP growth is accelerating.”

In terms of sectors, basic resources led the gains, with the Stoxx 600 sub-index for the sector up 2.7% amid rising copper prices.

In corporate news, Randstad was a high riser after the Dutch recruiter posted a 9% jump in third-quarter adjusted earnings before interest, taxes and amortisation, beating analysts’ expectations.

Air Liquide gained after saying third-quarter revenue was up 24%, boosted by its acquisition of Airgas Inc, while Orange rose after reporting an increase in third-quarter international sales.

Asset manager St James’s Place rallied after posting a 21% rise in gross inflows for the latest three-month stretch to reach £2.8bn, with the political uncertainty after the referendum not having had any distinguishable impact on its day-to-day business.

Italy’s Banca Monte dei Paschi rose in early trade after announcing plans to cut 2,600 jobs, close 500 branches and sell bad debt, but the stock was later suspended from trading after a 23% drop.

Switzerland’s Novartis slipped back despite reporting an increase in third quarter net income, while aerospace and automotive engineering group GKN was also in the red after it posted slower growth and lower trading margins for the nine months to the end of September.

Whitbread also declined. The company sprinkled a 5% dividend hike on a strong set of interim results, but investors overlooked acceleration at the Premier Inn hotels arm to focus on a dip in profits from Costa coffee shops.