European stocks closed in positive territory on Wednesday despite tumbling bond yields stoking concerns about a global economic slowdown.
The pan-European Stoxx 600 was 0.2% higher at the closing bell, with most sectors and all major bourses in positive territory. Travel and leisure stocks led the gains, while oil and gas stocks tumbled after oil prices plummeted.
German bond yields hit record lows on Wednesday, while U.S. Treasury yields plunged as investors moved back into safe haven assets following more rate cuts from central banks in New Zealand, Thailand and India.
Brent crude oil lost 4.2% by the closing bell Wednesday, trading at $56.45 a barrel, as concerns about the intensifying Sino-U.S. trade war fueled concerns about energy demand and the global economy. U.S. West Texas Intermediate Crude was around 5% lower.
Markets in the United States opened the session steeply lower but had pared some losses by the late morning. At one stage, the Dow Jones Industrial Average had shed almost 600 points.
Investor focus is also still largely attuned the Chinese yuan, after China's central bank set its currency slightly weaker than expected amid an ongoing escalation of its tit-for-tat with the U.S. The People's Bank of China set the official midpoint reference for the yuan at 6.9996 on Wednesday, slightly weaker than expected, two days after Washington labeled Beijing a currency manipulator.
Back in Europe, the banking sector was in focus as the European banking index hit a one-year low following a slew of new financial results. Commerzbank posted a net second-quarter profit of 271 million euros ($303.79 million) which was little changed from the same period a year ago, but exceeded the 217 million euros expected by analysts. The German lender's shares slid 6.4%.
Italy's Unicredit posted a sharp rise in second-quarter net profit of 1.85 billion euros, an increase from the 1.02 billion euros posted a year ago, boosted by the sale of its stake in FinecoBank, but coming in below analyst expectations. The bank's stock was down 5% by the end of the session.
Shares of ABN Amro were 0.3% higher at the closing bell, paring earlier losses after the Dutch bank topped estimates with a modest 1% rise in second-quarter net profit to 693 million euros, up from 688 million a year prior. However, the lender said it had incurred extra costs in anti-money laundering efforts.
British investment giant Standard Life Aberdeen also saw its shares slide 7.5% to the bottom of the Stoxx 600 after adjusted pre-tax profit fell in the first half of the year, while assets under management rose 5% despite an exit of clients from higher-margin fund products.
Elsewhere, food delivery service Just Eat's shares ended the session at the top of the index. Earlier this week the company announced it had agreed terms to be taken over by Dutch rival Takeaway.com, in a deal worth £5 billion ($6 billion).
Swiss workspace provider IWG also surged upward, its shares gaining 6% after announcing a substantial share buyback scheme on Tuesday. German pharmaceutical giant Bayer climbed toward the top of the European benchmark, gaining 6% after it announced the sale of Currenta, its joint venture with domestic peer Lanxess.
Economic data was also in focus after figures released Wednesday revealed German industrial output fell at a far steeper pace than expected in June, fueling fears that Europe's biggest economy could be heading for recession. Industrial output fell by 1.5% on the month, far exceeding the forecast 0.4% decline, figures from the Statistics Office showed.