Europe midday: Stocks come off lows helped by stimulus hopes

Stocks have come off their lows following a lower start on the back of news of a flare up in new cases of the China coronavirus in South Korea and reports of possible cases in Iran.

Those reports more than offset news of a further slowdown in new cases in China and the feel-good effect from the fresh record highs hit overnight by stocks on Wall Street.

"Despite continued news on the virus, the market remains sanguine as Chinese officials continue their efforts to mitigate the impact of COVID-19 on the economy. The PBOC’s deputy governor stated that the central bank has plenty of options to stabilise the economy and aid a quick recovery," said analysts at Rabobank.

"And such stabilising efforts may be much needed in a worst case situation: S&P Global Ratings warned that in a worst case scenario, the questionable loan ratio of Chinese banks may double."

As of 1301 GMT, the benchmark Stoxx 600 was down by 0.38% at 432.19, alongside a 0.16% dip on the German Dax to 13,766.45, while the FTSE Mibtel was giving back 0.69% to 25,301.88.

Euro/dollar meanwhile was drifting lower by 0.19% to 1.0789 and front month Brent crude oil futures had changed course to trade up by 0.66% to $59.51 a barrel on the ICE.

The World Health Organisation reported a 1.5% drop in the number of new virus cases in China on Thursday to reach 1,872.

But in South Korea, officials said the number of cases had jumped from 31 to 104, with the epicentre in the city of Daegu, especially among members of the Temple of the Tabernacle of the Testimony, formerly known as Shincheonji Church of Jesus, which authorities describe as a sect.

In company news, shares of A.P. Moller-Maersk A/S were edging up despite the world's largest shipping company having said that 2020 will be impacted by "considerable uncertainties" due to the outbreak's toll on global trade.

Elekta AB was the top faller on the Stoxx 600 after the radiation medicine specialist posted a 6% drop in gross order intake to SEK 4,276m in its third quarter as its US business failed to live up to expectations.

Air France was 6% lower alongside, having announced that the fallout from the virus would result in a €150-200.0m hit through April.

In Spain, Telefonica was walloped as management unveiled a 0.6% dip in full-year reported sales to €48.442bn, although free cash flow jumped by 20.6% to €5.912m, to hit its highest mark since 2013.

French insurer Axa was also under the cosh after reporting lower-than-expected profits on the back of restructuring costs.