Europe midday: Shares stay in the red as Soitec plunges

European stocks were still lower at midday on Thursday as investors fretted about inflationary pressures.

The pan-European Stoxx 600 was down 0.17 after starting the session higher, driven by a positive close on Asian markets.

Inflation worries continue to put a brake on equities with investors eyeing the potential path and pace of US rate hikes as the Federal Reserve tightens its pandemic-enforced loose monetary policy.

"Bond yields have been increasing recently as traders are starting to factor-in the possibility of higher interest rates in the months ahead, and typically the spikes in yields have sparked moves lower in stocks," said David Madden at Equiti Capital.

US markets were mixed with the tech-heavy Nasdaq falling sharply. Asian stock markets closed higher as China cut interest rates in response to a slowdown in economic growth and Japan reported a rise in export values.

The Chinese one-year loan prime rate was cut by 10 basis points, while the five-year LPR, which influences the pricing of home mortgages, was cut by 5 basis points, the first time since April 2020.

In equity news, shares in Swiss online pharmacy Zur Rose gained after a strong earnings report.

French industrial company Soitec plunged more than 16% to the bottom of the index after announcing that senior Atos executive Pierre Barnabe will succeed outgoing CEO Paul Boudre.

Deliveroo shares were up after the fast-food delivery platform said the gross value of orders on its platform rose 36% year-on-year in the fourth quarter, resulting in its hitting the top of guidance with a 70% rise for the year.

Primark owner Associated British Foods lost ground after it said fourth quarter sales at its Primark stores had been hit by the surge in Covid Omicron cases, but were now showing signs of recovery as it maintained full-year guidance.

Shell and BP fell as oil prices dropped, while consumer goods giant Unilever gained after it said late on Wednesday that it would not be lifting its £50bn offer for GlaxoSmithKline’s consumer healthcare business. Glaxo was on the back foot.