European shares are turning in a mixed performance on Wednesday as optimism for fresh stimulus measures waned before policy decisions by the Federal Reserve and the European Central Bank. Mixed earnings reports and weak euro-area manufacturing data also prompted investors to move to the sidelines after some early buying.
The downturn in the eurozone manufacturing sector gathered momentum at the start of the third quarter, final data from Markit Economics showed today. The manufacturing Purchasing Managers' Index fell more than initially estimated to 44 in July from 45.1 in June. This represented the fastest rate of contraction in 37 months and also the 12th straight months of contraction.
The Euro Stoxx 50 index of eurozone bluechip stocks is little changed, while the Stoxx Europe 50 index, which includes some major U.K. companies, is gaining 0.3 percent. Around Europe, France's CAC 40 is moving up 0.42 percent and the U,K.'s FTSE 100 is gaining 0.8 percent, while the German DAX and Switzerland's SMI are falling modestly.
Henkel AG & Co. KGaA is rising 1.7 percent in Frankfurt after the detergent maker reported higher profit and revenue for the second quarter, driven by good performance in emerging markets. Deutsche Bank AG is declining 1.3 percent after the lender announced 1,900 job cuts as part of its efforts to realize savings of about 3 billion euros.
BMW Group is down over 4 percent as it reported a 28 percent decline in profit for the second quarter, despite higher revenues and sales volume, owing partly to higher costs and a benefit last year. The firm reaffirmed the targets for 2012.
Societe Generale SA is down 0.8 percent in Paris after the French lender reported a slump in its second-quarter profit, reflecting slowdown in economic growth in Europe and continued tensions in European financial markets.
Vinci SA is tumbling 3.7 percent after the construction giant reported a drop in first-half net profit to 784 million euros or 1.44 euro per share from 814 million euros or 1.48 euro per share in the same period last year, hurt mainly by special charges. The company issued a cautious outlook for rest of the year, citing the European economic crisis.
Schneider Electric S.A. is climbing 43.1 percent as it confirmed its full-year forecast of flat to slightly positive organic growth for sales and an adjusted EBITA margin between 14 percent and 15 percent.
Shares of ENI SpA are down 0.2 percent in Milan after the Italian oil and gas firm reported a sharp decline in second-quarter profit, hurt mainly by hefty impairment losses.
Elsewhere, Asian markets turned in a mixed performance as weaker-than-expected Chinese manufacturing data undermined the fragile state of the world economy. Commodities are trading mixed, as the euro held steady against the dollar ahead of Fed decision tonight and the ECB meeting tomorrow.
The Dow futures indicate a positive start on Wall Street as investors await a private sector job report and the ISM's national manufacturing survey results.
by RTT Staff Writer
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