Europe midday: Markets rangebound after recent gains
European stocks were rangebound on Tuesday as equity markets continued to pause for breath following the recent rally, which saw the Stoxx 600 rise more than 6% over the past three weeks.
After pushing higher in morning trade, the Stoxx 600 was trading more or less flat at 517.91 by lunchtime, with most indices across the continent registering moderate gains of no more than 0.3%. The pan-European benchmark has risen in 12 of the last 15 trading sessions since hitting a six-month low on 5 August.
“This week is likely to be dominated by Nvidia results and a second estimate of US second-quarter GDP," said AJ Bell investment director Russ Mould.
Likely keeping a lid on risk appetite was a deteriorating outlook for the German economy, as confirmed by a consumer survey released by GfK and the Nuremberg Institute for Market Decisions on Tuesday.
The forward-looking consumer sentiment index for September fell to -22 from a revised -18.6 in August, coming in below expectations for a reading of -18.2. Rolf Buerkl, consumer expert at NIM, said that slightly rising unemployment rates, an increase in corporate insolvencies and staff reduction plans at various companies in Germany are causing employees to worry about their jobs.
Meanwhile, the final reading of second-quarter German GDP was revised higher, with the year-on-year change improving to 0% from -0.1% in the second quarter, better than the flash reading of -0.1% released last month. Quarter-on-quarter growth however remained at -0.1%, after the economy expanded by 0.2% in the first three months of the year.
Market movers
Bunzl was a high riser in London, jumping around 8% to a record high after the distribution and outsourcing company upgraded its full-year guidance and launched a share buyback programme.
Heading the other way was food ingredient and retail conglommerate AB Foods after Deutsche Bank downgraded the stock from 'hold' to 'sell' and cut its target price from 2,290p to 2,190p.
Zurich airport operator Flughafen Zuerich was the worst performer on the Stoxx 600 after first-half results came in below expectations, even as passenger traffic forecasts for the full year were lifted.
German drug discovery and development company Evotec surged 8% as the stock continues to recover after a battering earlier this month after announcing a round of job cuts and the exit of its gene therapy operations.
Also in Frankfurt, commercial vehicle maker Daimler Truck was in reverse after Goldman Sachs cut its recommendation on the stock from 'buy' to 'neutral'.