EUROPE MARKETS: European Stocks Hunt For Firm Direction As Earnings Reports Pile Up

By Carla Mozee, MarketWatch

Investors assess mixed tone of U.S. Federal Reserve minutes

European stocks ping-ponged between small gains and losses Thursday, as investors sifted through earnings reports and assessed the mixed tone on U.S. interest rates from the Federal Reserve.

The Stoxx Europe 600 was up less than 1 point at 373.51. Utility and consumer-related shares fell, but the telecoms and oil and gas sectors advanced. The pan-European benchmark on Wednesday finished unchanged at 373.38, but held near its best levels since late 2015.

See:5 reasons to invest in European stocks now (http://www.marketwatch.com/story/5-reasons-to-invest-in-european-stocks-now-2017-02-23)

In the currency market, the euro fetched $1.0557, not far from the $1.0561 it traded at late Wednesday in New York in the wake of the Fed minutes.

"Many" Fed members supported raising interest rates (http://www.marketwatch.com/story/fed-minutes-show-support-for-rate-hike-fairly-soon-2017-02-22) in the world's largest economy "fairly soon", but were cautious as they await details about stimulus measures wanted by U.S. President Donald Trump and the Republican Congress.

"It is the lack of commitment to a hiking timeline and overall ambiguity that continues to leave investors empty-handed," said Lukman Otunuga, FXTM research analyst, in a note.

He said a March rate hike looks unlikely. But "a scenario where U.S. economic data repeatedly exceeds expectations ... could prompt the central bank to surprise markets by taking action in May."

While the Fed is on the path of raising rates, the European Central Bank has left rates at ultralow levels and is buying 60 billion euros ($63 billion) a month of government bonds throughout the eurozone.

Movers: Telefonica SA (TEF) (TEF) gained 2.5%. The Spanish telecom company swung to a fourth-quarter profit of EUR145 million (http://www.marketwatch.com/story/telefonica-returns-to-profit-2017-02-23) after booking major restructuring costs a year earlier.

Barclays PLC shares (BCS) were pushed up 3% as the London-based bank swung to a full-year net profit of 1.6 billion pounds (http://www.marketwatch.com/story/barclays-swings-to-profit-as-overhaul-nears-end-2017-02-23) ($1.99 billion) and said it's now just months away from finishing its restructuring.

Veolia Environnement SA (VIE.FR) dropped 5.4%. The company expects 2017 adjusted net profit to remain roughly stable (http://www.marketwatch.com/story/veolia-profit-rises-as-restructuring-bears-fruit-2017-02-23) as low inflation hinders revenue growth and as some local authorities in Europe retake the handling of water and waste management from private companies. Adjusted net income in 2016 was above expectations.

Peugeot SA (UG.FR) said it's planning to pay its first dividend since 2010 (http://www.marketwatch.com/story/peugeot-brings-back-dividend-as-profit-jumps-79-2017-02-23). Net profit surged 79% for 2016, while revenue fell 1.2% to EUR54.03 billion. Shares of the French car maker fell 2.5%.

Indexes: France's CAC 40 rose 0.3% to 4,908.67, and Germany's DAX 30 picked up 0.1% at 12.011.72.

The U.K.'s FTSE 100 was fractionally higher at 7,303.10. Spain's IBEX 35 moved up 0.5% to 9,521.70.

Data: Germany's economy grew at fourth-quarter rate of 0.4%, or 1.7% in annualized terms (http://www.marketwatch.com/story/german-gdp-up-17-on-year-as-budget-surplus-grows-2017-02-23), said statistics agency Destatis, confirming its earlier estimates.

(END) Dow Jones Newswires

February 23, 2017 05:18 ET (10:18 GMT)

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