Europe Markets

Europe ends mostly lower as earnings, banks weigh; oil, miners outperform


European markets closed mostly lower on Wednesday, as a mixed set of earnings and weakness in the banking sector weighed on sentiment, despite gains in various commodities.

The pan-European STOXX 600 came off session lows, to close down 0.5 percent provisionally. Sectors finished mostly lower, while basic resources stocks outperformed, with the sector index posting gains of 1.9 percent.

Britain's FTSE 100 closed up 0.1 percent, supported by a bounce in U.K. mining stocks, while France's CAC and Germany's DAX ended lower, down 0.5 and 0.7 percent respectively.

Mining stocks outperformed on the back of a sharp rise in metal prices. Anglo American ended 5.4 percent up and Glencore jumped 2.2 percent, after Canaccord Genuity raised its price target on both stocks.

U.S. dollar weakness helped push gold and silver prices higher, boosting precious metal firms Randgold Resources and Fresnillo.

Oil prices spiked during late trade in Europe, after the Energy Information Administration reported that U.S. crude stockpiles had fallen by 3.4 million barrels in the previous week.

This boosted energy stocks, with Tullow Oil posting gains of 4.8 percent.

Italian banks feel the heat

The Italian banking sector was once again a key market mover, after disappointing earnings on Tuesday.

Shares in Banco Popolare closed 9.1 percent lower on Wednesday and trade was briefly halted after the bank posted a surprise first-quarter net loss on Tuesday night. On Wednesday, Barclays cut its price target for the stock.

Banca Popolare di Milano slipped over 6 percent lower on Wednesday after it reported on Tuesday a 29 percent fall in first-quarter net profit.

Elsewhere, Austria's Raiffeisen Bank International and its unlisted parent Raiffeisen Zentralbank said they would look into merging to bolster the latter's capital reserves. Shares of Raiffeisen Bank International fell to the bottom of benchmarks, off 10.1 percent.

Wednesday's earnings

The top performer on Europe's STOXX 600 was Schibsted, which soared 12.2 percent after the Norwegian media group reported better-than-expected first-quarter earnings.

Dutch telecoms firm Altice confirmed its full-year guidance for 2016 after its adjusted core earnings rose just 0.9 percent in the first quarter of the year. Shares initially declined, but reversed in later trade, to close up 3.5 percent.

However, French outdoor advertising company JCDecaux sank 10 percent after a slew of brokers including HSBC and Barclays cut their price targetd for the stock.

Utility E.ON said first-quarter core earnings rose 8 percent, helped by a long-term gas supply contract with Gazprom, but shares sank 5.6 percent.

Danish brewer Carlsberg maintained its 2016 guidance despite a fall in sales in the first quarter due to a decline in China and negative currency effects, sending shares to close almost 3 percent down.

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In Asia, markets closed mixed, as investors eyed currency fluctuations, while in the U.S., stocks traded mostly lower around Europe's close, due to a weak set of earnings.

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Correction: This article has been updated to reflect the Dow closed more than 1 percent higher Tuesday. An earlier version misstated the percentage gain.

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