Europe midday: Markets lower after Pence squashes Sino-US optimism
European stocks were down at lunchtime on Friday as a speech from the US Vice President damaged optimism for a Sino-US trade deal, while calls for a UK general election added to Brexit uncertainty.
At 1156 BST, the Stoxx 600 was 0.4% lower at 395.96, as Germany's Dax dropped by 0.2% to 12,842.23 and the French CAC 40 remained flat at 5,684.30. London's FTSE 100 was down by 0.6% at 7,287.16.
Hopes for a upcoming resolution to the Sino-US trade dispute were damaged after US Vice President Mike Pence voiced solidarity with Hong Kong protesters, attacked China's "aggressive and destabilising" policies and lambasted the NBA and Nike of "kowtowing" to Beijing.
Meanwhile, Congress voted in favour of legislation to prohibit American companies from selling munition equipment, such as tear gas, pepper spray and rubber bullets, to authorities in Hong Kong.
IG analyst Joshua Mahoney said: "What began as an issue for Hong Kong’s right for democracy and self-determination has now spilled into the wider corporate picture, with both the NBA and Nike coming in for criticism over their censorship in the bid to maintain Chinese funding.
"For markets this is simply another issue that could complicate or derail trade talks, with the Chinese largely combative when pressed by foreign powers on the Hong Kong issue."
Back in Europe, EU ambassadors were meeting to discuss a possible three month Brexit deadline delay, as UK Prime Minister Boris Johnson said he would give MPs more time to examine his exit deal if they agreed to a general election in December.
CMC Markets analyst David Madden said: "Jeremy Corbyn has claimed he will not support an election unless Mr Johnson rules out a no-deal Brexit. The Labour leader knows full well that Boris won’t rule out a no-deal possibility, so the UK might be stuck in the departure lounge of the EU for some time."
Meanwhile, data from Germany's Ifo institute showed that the nation's business morale held steady at 94.6 in October, on par with the prior month and just ahead of a consensus forecast for a reading of 94.5.
However, the current assessment index slipped to 97.8 in from 98.6 the month before, falling short of expectations for a reading of 98.0.
Analysts from Pantheon Macroeconomics said: "Overall, the key message from the IFO is still one of slowing growth, and acute recession risks. Meanwhile, the details were mixed. The manufacturing index rose a bit, but remains depressed overall, while the services and wholesale confidence indices fell modestly.
"Sentiment in construction also dipped, but the level is robust on a whole."
Among individual stocks, French luxury goods group Kering surged after double digit third quarter sales growth from its Gucci designer brand, with a 16.6% sales increase in the Asia-Pacific region alleviating fears that demonstrations in Hong Kong could hamper trading.
Moncler was also in the green after its third quarter revenue growth exceeded expectations despite the jacket maker having taken a 40% hit to sales in Hong Kong.
Spanish meat casings manufacturer Viscofan leapt after third quarter net profits jumped by 17% after sales improved across Europe, Asia and the Americas.
French video game developer Ubisoft dived after announcing delays to the release of its Watch Dogs Legion, Gods & Monsters, and Rainbow 6 Quarantine titles following the "underperformance" of Ghost Recon Breakpoint and The Division 2.
United Internet was in the red after cutting its outlook as its investee, telecoms operator 1&1 Drillisch, had its request to retroactively review prices under a 2014 deal with rival Telefonica Deutschland rejected.