By Geoffrey Smith
Investing.com -- Europe’s stock markets were mostly lower by mid-morning on Wednesday as fresh business surveys suggested the contraction in manufacturing deepened in July, a trend also borne out by more gloomy outlooks and disappointing earnings figures.
The benchmark Euro Stoxx 600 was down 0.3% at 390.52 by 4:55 AM ET (0855 GMT), while the U.K. FTSE was down 0.9% and the German DAX was up 0.1%.
The “flash” reading for IHS Markit’s purchasing manager index for the Eurozone manufacturing sector fell to its lowest in six years, with the German index dropping to its lowest since 2009, dashing hopes for some stabilization. Evidence that the problem is a global one had come earlier, with declines in the comparable indexes for both Australia and Japan. The Richmond Federal Reserve’s manufacturing survey on Tuesday, meanwhile, had also shown business conditions at their weakest in six years.
Against that backdrop, Peugeot's (PA:PEUP) report of an 11% rise in operating income for the first half stood out, driving the stock 2.1% higher, even though the company revised down its expectations for the global auto market this year at the same time.
At the other end of the scale, Aston Martin Lagonda (LON:AML) fell over 20% after slashing its sales and margin guidance for the year, citing “macro-economic uncertainty and enduring weakness in UK and European markets.”
Somewhere in between was Daimler (DE:DAIGn), the maker of Mercedes-Benz, which rebounded from early losses after saying it would step up its cost-cutting plans in the face of weak demand.
Stocks had started the morning with a tailwind out of Asia on the news that the U.S. and China would resume high-level talks on trade for the first time in weeks. That follows a meeting between President Donald Trump and U.S. tech companies to thrash out issues relating to the conditions under which they can sell to Chinese telecoms giant Huawei.
Elsewhere in Europe, Deutsche Bank (DE:DBKGn) shares fell below 7 euros again after it announced a bigger second-quarter restructuring charge than expected in the wake of its slash-and-burn exercise a couple of weeks ago. Iberdrola (MC:IBE), one of the world’s biggest renewable power companies, rose 1.1% after it reported profit above expectations and said it now expects full-year profit to rise more than 10%.
In the U.K., broadcaster ITV (LON:ITV) rose 5.5% after reporting a smaller drop in revenue than feared, and announcing two new series of its “Love Island” moneyspinner. Shares in iron ore miners fell though after Brazil’s Vale (NYSE:VALE) announced the restart of production at one of its largest mines.