European stocks turn lower in mid-day trade; DAX down 0.2%

Investing.com - European stock markets turned modestly lower during European afternoon trade on Monday, as investors digested the latest batch of corporate earnings amid ongoing uncertainty surrounding Spain’s bailout plan.

During European afternoon, the EURO STOXX 50 eased up 0.15%, France’s CAC 40 declined 0.1%, while Germany’s DAX 30 retreated 0.2%.

Sentiment firmed up after regional election results in Spain over the weekend indicated support for the austerity policies of Prime Minister Mariano Rajoy.

The center-right Popular Party of Prime Minister Rajoy increased its majority in his home region of Galicia on Sunday, removing a possible obstacle to formally requesting a bailout from Spain’s euro zone partners.

A bailout request by Spain would activate the European Central Bank’s bond purchasing scheme, aimed at lowering high peripheral bond yields in the euro zone.

Prime Minister Rajoy said Friday he still had not decided whether to request a sovereign bailout.

In earnings news, Dutch conglomerate Royal Philips Electronics saw shares gain 4.8% after it reported group sales rose 14% to EUR6.13 billion in the third quarter.

Shares in lenders also contributed to gains, with Italy’s Unicredit climbing 2%, France’s BNP Paribas trading up 1% and Germany’s Deutsche Bank adding 1.2%.

On the downside, Nexans saw shares drop 6.9% after the world’s second- biggest maker of cables reduced its full-year revenue forecast, predicting “stable” sales compared with a previous prediction for “slight organic growth.”

Also in France, water and waste utility Veolia Environnement sank 4.6% after denying rumors over the weekend that a merger with Suez Environnement was on the agenda. Shares of Suez traded down 0.95%.

Elsewhere, in London, commodity-heavy FTSE 100 eased down 0.1%, as losses in oil firms weighed on the index.

Oil and gas major British Petroleum shed 0.45% after confirming that it sold its 50% stake in Russian oil producer TNK-BP to state-run OAO Rosneft in a deal valued at nearly USD17.1 billion in cash plus 12.84% of Rosneft shares.

Other oil firms were also lower, with Royal Dutch Shell down 0.3% and BG Group slumping 0.6%.

Gains in miners provided support, with Randgold Resources climbing 2.15%, Xstrata gaining 1.7% and Anglo American up 1.15%.

In the U.S., equity markets pointed to a mildly higher open, as investors were awaiting the release of a batch of highly anticipated corporate earnings reports to gauge the strength of the global economy.

The Dow Jones Industrial Average futures pointed to a 0.1% gain, S&P 500 futures added 0.15%, while the Nasdaq 100 futures indicated a 0.3% rise.

Ahead of the open, global economic bellwether Caterpillar reported lower-than-expected third quarter revenue, citing a slowdown in sales in China. The company also cut its full-year earnings outlook.

With no data due Monday, investors will an eye on U.S. politics. The third and final U.S. presidential debate takes place Monday evening before elections on November 6.