Europe close: Banks' run higher stalls at technical resistance

European equity markets drifted lower weighed down by weak results from Swiss consumer goods giant Nestle amid wider profit-taking following several days of gains on hopes around President Donald Trump's prospective tax plans.

By the closing bell, the benchmark Stoxx Europe 600 index was down 0.37% to 370.10, Germany’s DAX slipped 0.31% to 11,757.24 and France’s CAC 40 declined 0.52% to 4,899.46.

Banks were lower on Thursday, with the Stoxx 600 gauge of lenders' shares ending the day down by 0.9% at 176.65, but nonetheless just a smidgen below where it began in 2016 and at a key area of technical resistance on price charts.

As one might expect, the yield on the benchmark ten-year German Bund was lower by two basis points at 0.35% amid a wave of risk aversion, while dollar/yen, a key gauge of investor sentiment, was down by 0.62% at 113.37.

Mike van Dulken, head of research at Accendo Markets, said: "Equity markets are under the cosh this morning from a hat trick of pressures. A dollar sell-off has produced currency hindrance by way of sterling and euro strength to hinder the internationally exposed. Some large-caps have gone ex-dividend.

"Miners are failing to see a weak dollar benefit base metals prices, even if oil is higher. That said, US markets closing at record highs for a fifth straight session, something they haven't done in 25 years, suggests the Trump trade is still being embraced, meaning this could be just another blip amid a longer-term uptrend."

Oil prices were slightly higher with Brent crude up 0.09% to $55.80 per barrel and West Texas Intermediate up 0.70% at $53.46, as the US dollar spot index gave back 0.56% to 100.61.

In company news, Nestlé fell 0.76% after the maker of Kit-Kat and Nescafe said that profit fell and missed expectations for 2016. Net profit was down to SFr8.5bn (£6.78bn) from SFr9.1bn the previous year and below expectations of SFr9.59bn. It also revised its sales growth target for 2017 to between 2% and 4%.

Air France surged 12.60% after the airline’s full-year results exceeded expectations with a 35% increase in earnings. Shares in peers IAG, easyJet and Deutsche Lufthansa also rose 0.60%, 0.37% and 1.45%, respectively.

London-listed Cobham tumbled 14.59% after it issued a profit warning for 2016 and said it will be hard to meet expectations for this year.

AstraZeneca, BP, Shell and Imperial Brands went ex-dividend.

On the data front, French unemployment slipped to 10% in the fourth quarter of 2016 from 10.1% in the third. This was above the 9.8% consensus forecast.

Car registrations in the European Union climbed 10% on extra selling days to 1.2m vehicles in January compared to last year.

Significantly, the minutes of the European Central Bank's meeting in January showed the ECB was aiming to be a "steady hand" during a period of global uncertainty.

The euro area monetary authority stood pat on interest rates in January, with its chief Mario Draghi stressing the 'temporary' nature of recent inflation pressures.

Those same minutes also revealed the Governing Council was "advised to remain patient and maintain a ‘steady hand’ to provide stability and predictability in an environment that was still characterised by a high level of uncertainty".