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European stocks steady to lower in cautious trade; DAX down 0.19%

Published 08/31/2016, 03:40 AM
Updated 08/31/2016, 03:40 AM
© Reuters.  Frankfurt Stock Exchange

© Reuters. Frankfurt Stock Exchange

Investing.com - European stocks were steady to lower on Wednesday, after upbeat German retail sales data, as investors remained cautious ahead of the release of a U.S. jobs report due later in the day.

During European morning trade, the EURO STOXX 50 inched 0.03% lower, France’s CAC 40 dipped 0.04%, while Germany’s DAX 30 slipped 0.19%.

Earlier Wednesday, data showed that German retail sales rose 1.7% in July, beating expectations for a 0.5% uptick and after a 0.6% slip the previous month. However, year-on-year, retail sales declined by 1.5% last month, compared to expectations for a 0.3% rise.

Market participants were looking ahead to a U.S. employment report due later Wednesday, for further indications on the strength of the economy.

On Tuesday Federal Reserve Vice Chairman Stanley Fischer said the U.S. labor market is almost at full strength and the pace of interest rate increases will be data dependent.

Financial stocks were broadly higher, as French lenders Societe Generale (PA:SOGN) and BNP Paribas (PA:BNPP) rallied 1.23% and 1.30%, while Germany’s Deutsche Bank (DE:DBKGn) and Commerzbank (DE:CBKG) surged 2.00% and 4.27%.

Germany’s Manager Magazin earlier reported that Deutsche Bank explored a possible merger with rival Commerzbank, without saying where it obtained the information, adding that the considerations were “only of a theoretical nature” and at a very early stage.

Among peripheral lenders, Italy’s Intesa Sanpaolo (MI:ISP) and Unicredit (MI:CRDI) climbed 0.59% and 0.81% respectively, while Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) advanced 0.49% and 1.12%.

Airbus Group (PA:AIR) added to gains, with shares up 1.19% after the company said it delivered more aircraft in August than for the same period in any previous year, improving its chances of meeting 2016 targets after earlier delays in receiving parts.

In London, commodity-heavy FTSE 100 slipped 0.18%, weighed by sharp losses in the mining sector.

Shares in Rio Tinto PLC (LON:RIO) tumbled 1.80% and BHP Billiton PLC (LON:BLT) lost 2.16%, while rivals Randgold Resources Ltd (LON:RRS) and Anglo American PLC (LON:AAL) plummeted 2.50% respectively.

Meanwhile, financial stocks were sharply higher as Lloyds Banking (LON:LLOY) climbed 0.61% and the Royal Bank of Scotland (LON:RBS) advanced 0.87%, while HSBC Holdings (LON:HSBA) jumped 1.38% and Barclays (LON:BARC) rallied 1.46%.

ARM Holdings (LON:ARM) was also on the upside, with shares adding 0.12% after shareholders on Tuesday approved the recommended $32-billion cash offer made by Japan's SoftBank Group Corp.

In the U.S., equity markets pointed to a steady to lower open. The Dow Jones Industrial Average futures pointed to a 0.06% dip, S&P 500 futures showed a 0.05% downtick, while the Nasdaq 100 futures indicated a 0.07% loss.

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