Europe midday: Stocks turn lower as energy weighs but Deutsche Bank rallies on Q2
European stocks had turned mostly lower by midday on Monday following mixed Chinese data and amid weakness in the energy sector, but Deutsche Bank bucked the trend after solid second-quarter numbers.
The benchmark Stoxx Europe 600 index was down 0.1% at 384.49, France's CAC 40 was 0.3% lower at 5,414.76 and Germany's DAX was 0.1% higher at 12,551.45.
Energy stocks dropped in line with oil prices amid reports that Saudi Arabia was offering extra crude supplies to some of its customers following a plan to boost output. The Stoxx 600 oil and gas index was down 0.6% as Brent crude slid 1.9% to $73.95 a barrel and West Texas Intermediate declined 1.6% to $69.87.
Meanwhile, the sub-index for basic resources was also 0.6% lower following mixed data out of China. Figures showed the economy there slowed modestly in the second quarter, with GDP growth of 6.7%, down from 6.8% in the first quarter but in line with expectations.
Meanwhile, fixed asset investment slowed to 6% in June from 6.1% in May and industrial production slid to 6% last month from 6.8% in May, missing expectations for 6.5% growth. However, retail sales rebounded from multi-year lows of 8.5% in May to come in at 9%, meeting expectations.
Closer to home, the latest trade data from Eurostat revealed that the eurozone's trade surplus with the rest of the world narrowed in May to €16.9bn from a downwardly-revised €18bn in April, versus consensus expectations of €18.6bn.
Investors were looking ahead to a summit in Helsinki later in the day between the US and Russia. The two leaders are due to meet one-on-one in what will be the first ever summit between the two. It comes after 12 Russian agents were indicted in the Mueller Investigation and following clashes between Trump and his Nato allies last week in Brussels over their defence spending policies.
Mike van Dulken, head of research at Accendo Markets, said: "While the talks themselves may only last a couple of hours, be on the lookout for the post-meeting press conference. The usual Trumpian remarks on politics, trade and oil could move financial markets."
In corporate news, Deutsche Bank surged after its second-quarter results came in comfortably ahead of analysts' expectations, with management expecting pre-tax profit of around €700m and net income of about €400m versus consensus expectations of €321m and €159m, respectively.
Neil Wilson, chief market analyst at Markets.com, said: "The results are clearly good news for new boss Christian Sewing and a welcome relief from a series of bad news reports following the restructuring announcement, including its US unit failing the Fed stress test and being placed on the Federal Deposit Insurance Corporation naughty step."
He added: "The fact is that while restructuring can deliver important cost reductions, it is less clear what Deutsche’s plans are to grow revenues thereafter. Deutsche has been slow to restructure and now it’s got to sprint to catch up. Today’s Q2 update suggests it is riding certain market tailwinds but can it be sustained amid such tough cost cutting?"
Indivior rocketed after a US court granted a preliminary injunction to prevent Dr Reddy's Laboratories from selling a generic version of the company's Suboxone Film for treating opioid addiction until a decision is made on patent litigation.
Finnish lift company Kone was on the front foot following a report that it and Thyssenkrupp had held merger talks on their lift operations. Thyssenkrupp was also trading higher.
French publisher Lagardere gained ground following an upgrade to 'overweight' from Morgan Stanley.