Europe close: Banks drive gains ahead of Fed meeting

European stocks were mostly higher on Wednesday even if a bit sluggish, as investors eyed news from the US Federal Reserve later in the day, with strong results from Deutsche Bank, Lloyds Banking Group and Santander boosting local markets.

"It has been a very quiet week so far for markets overall, some volatility in individual names notwithstanding, and it is not surprising that investors continue to search for a catalyst to drive volatility in the short-term," said IG chief market analyst Chris Beauchamp.

"It is far from clear that the FOMC will provide that spark however, with most investors still expecting the Fed to remain silent over any change in policy until later in the year when, it is hoped, the picture of a strong recovery bolstered by stimulus plans will be more advanced."

The pan-European Stoxx 600 index was up just 0.02% to 439.92, while the FTSE Mib dipped 0.06% to 24,459.57.

France's Cac-40 on the other hand added 0.53% to 6,306.98, while Spain's Ibex 35 added 0.49% to 8,799.6.

Deutsche Bank shares jumped 11% as strength at its investment bank helped offset headwinds from restructuring and the pandemic. Lloyds rose 3.5% after reporting a better-than-expected profit and lower Covid-19 bad debt provisions. Sweden’s SEB and Spain’s Santander were also higher after quarterly results, while Commerzbank also gained.

Reckitt Benckiser fell despite the company maintaining full-year guidance.

Shares in building supplies group Travis Perkins rose 4% after its shareholders approved the demerger of Wickes Group.

The spinoff plans were originally unveiled by Travis Perkins in December 2018 with a view to focusing on its advantaged trade businesses and simplifying the group to enable a more streamlined cost structure. However, the plans were put on hold in March 2020 when the Covid pandemic took hold.

Shares in WPP gained 4% as the company said it made a strong start to 2021 with all its business lines returning to growth and business activity began to pick up from the Covid-19 crisis.

The world's biggest advertising company reported a 1.8% increase in revenue to £2.9bn in the three months to the end of March from a year earlier. Like-for-like income rose 6.3%.

Sainsbury's shares were out of favour after annual profit fell 39% as rising food sales were outweighed by higher costs during the pandemic but the company kept its annual dividend unchanged.