European markets close lower despite improved German sentiment, positive PMI data

Shares of Stockholm-listed Millicom jumped 15.2% to top the Stoxx 600 index on reports the telecoms company may be bought out.

The Financial Times reported, citing people familiar with the matter, that Apollo Global Management partnered with Marcelo Claure, the former SoftBank executive, to take over Millicom. The report suggests Millicom could be valued at nearly $10 billion, including debt.

Shares hit a session high of $17.66 shortly after 2:30 p.m. London time.

— Hannah Ward-Glenton

The chief executive of Givaudan, the Swiss maker of flavours and fragrances, told CNBC input costs had risen by a "massive amount" as the company reported full-year results.

Germany has announced that it is ready to send 14 of its own tanks to Ukraine and to allow others to do so, in an U-turn from its previous position.

Chancellor Olaf Scholz said the Leopard 2 tanks will come from its own Bundeswehr (German armed forces) stocks.

Read the full story here.

— Holly Ellyatt

German business sentiment has perked up this month, according to a widely watched survey from the Munich-based Ifo Institute.

The group's Business Climate Index rose to 90.2 points from 88.6 points on "considerable less pessimistic expectations," a release said, although this was below its 2021 and early 2022 level. Companies in the services sector also reported lower satisfaction with their current situation.

However, manufacturing firms signaled improved present satisfaction and future optimism, and there was improved sentiment for trade.

"The expectation was that there might be a recession in the fourth quarter of '22 and the first quarter of '23. Now it looks like the last quarter was flat," president of the Ifo, Clemens Fuest, told CNBC's Arabile Gumede.

"The economy may still be shrinking a little in the first quarter, but given the improvement in expectations we're seeing now from businesses, it is very unlikely we will have a technical recession."

— Jenni Reid

IAG, owner of British Airways and Iberia, was among the top performers in the Stoxx 600 index in early trade, rising 3.5%.

Its low-cost rival EasyJet reported a 47% rise in passenger numbers for the final quarter of 2022 and said it would likely exceed earnings expectations for the full year. On Tuesday, Liberum analyst Gerald Khoo raised his target price for IAG, which has risen more than 33% in the year to date.

Arms manufacturer Rheinmetall also climbed on news that the German government is set to send its Leopard 2 tanks to Ukraine, with a 3% gain taking the stock to a record high.

At the bottom of the table, Danish IT consultancy Netcompany shed more than 20% despite reporting higher revenue and earnings, as it warned of a challenging environment which it said would affect future growth and earnings.

European markets were choppy overall, with the Stoxx 600 down 0.1% at 8:30 a.m. London time.

— Jenni Reid

Morgan Stanley has named eight stocks to buy ahead of a hotly anticipated earnings season in Europe.

Stocks in the region have risen this year on the first signs of moderating inflation across Europe. Nonetheless, the impact of sluggish growth and the war in Ukraine remains key concerns for investors.

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— Ganesh Rao

Shares in German arms firm Rheinmetall rose 2.5% in early trade, hitting a fresh record high, according to Reuters.

The company manufactures the Leopard 2 tanks that Germany is believed to be on the cusp of agreeing to send to Ukraine.

On Tuesday, the company hiked its sales expectations for 2025 and said it anticipates higher demand for weapons due to the Ukraine war.

— Jenni Reid

Budget airline easyJet reported 47% year on year passenger growth for the last three months of 2022 and said it expected to exceed analyst forecasts for the full financial year.

The company's shares were up 7% in early trade.

Its pre-tax losses for the first quarter narrowed, from £213 million ($262 million) to £133 million, and it anticipates a loss in the first half.

"Whilst we remain mindful of the uncertain macroeconomic outlook across the globe, based on current high levels of demand and strong bookings, easyJet anticipates beating the current market profit expectations for FY23," its release said.

— Jenni Reid

The U.S. and Germany are believed to be on the cusp of agreeing to deliver modern battle tanks to Ukraine after months of indecision and debate over the issue.

Reports late Tuesday suggested that German Chancellor Olaf Scholz was ready to agree to sending a number of Leopard 2 tanks to Ukraine, and to allow allies to do the same with their own German-made tanks.

Read the full story here.

European markets are set to open in positive territory Wednesday, building on gains seen since the start of the week.

The U.K.'s FTSE 100 index is expected to open 40 points higher at 8,084, Germany's DAX up 60 points at 18,201, France's CAC 20 points higher at 8,130 and Italy's FTSE MIB up 206 points at 34,331, according to data from IG.

Earnings come from Orange, Air Liquide, Iberdrola, Roche and Heathrow. Data releases include Germany's Ifo Institute's survey on business conditions and expectations for April.

— Holly Ellyatt

Shares of an indie video game developer are set to rise by more than 200%, according to Berenberg, which said the company provided a "very encouraging" 2023 outlook.

The investment bank isn't the only one that likes the developer — although it's the most bullish. The consensus price target of six analysts covering the stock indicates a potential upside of over 70%, according to FactSet data. All but one have a buy rating on the company's shares.

CNBC Pro subscribers can read more here.

— Ganesh Rao