Europe midday: Stocks extend gains as investors mull earnings; Fed eyed

European stocks had extended gains by midday as investors sifted through more earnings and eyed the latest policy announcement from the Federal Reserve.

The benchmark Stoxx Europe 600 index was up 0.5%, France's CAC 40 was 0.8% firmer and Germany's DAX was 0.3% higher.

Accendo Markets analyst Mike van Dulken said: "Equities are holding this morning's gains, seemingly confident that this evening's Fed statement won't offer up anything to derail bullish sentiment from earnings season."

The Federal Reserve policy announcement is due at 1900 BST amid expectations there will be no change to interest rates.

FXTM research analyst Lukman Otunuga said markets will be paying very close attention to see if the policy statement offers any fresh details on how and when the Federal Reserve plans to normalise its $4.5 trillion balance sheet.

"Any unexpected surprises from the policy statement may come in the form of inflation concerns as the central bank acknowledges the fall in inflation and the impact it has on reaching their 2% inflation target," he said.

On the corporate front, Tullow Oil gushed higher as it said revenue rose but it swung to a pre-tax loss in the first half, with the numbers were in line with expectations.

Peugeot pushed higher as it posted a 4.1% rise in first-half profit, while Swiss pharmaceutical company Lonza also racked up strong gains after better-than-expected second-quarter results.

LafargeHolcim turned up following earlier losses, after cutting its growth forecast for this year as second-quarter sales missed estimates.

Going the other way, oil services company Subsea 7 reversed earlier gains to trade lower despite better-than-expected second-quarter earnings and an upgrade to its revenue guidance for the year.

Daimler also reversed course despite reporting another quarter of record sales and revenue.

Chip maker ASM International was on the back foot despite positing record second-quarter intake, while UniCredit slipped after announcing it has suffered a cyber attack on its Italian clients.

Dutch telecommunications operator KPN retreated even as it said it was well positioned to hit targets for the year and posted an 18% jump in second-quarter net profit.

Earlier, data from Insee revealed that French consumer confidence unexpectedly fell sharply in July, with the composite indicator of confidence down to 104 from 108 versus expectations for no change and after gaining eight points over the two previous months.