(Bloomberg) -- European stocks were steady on a busy day for earnings and before the European Central Bank's meeting provides further clues about the path of interest rates.
The Stoxx Europe 600 slipped 0.1% by 8:10 a.m. in London. The chemicals and energy sectors were among the gainers, while banks and real estate were among the worst laggards.
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Among individual movers, STMicroelectronics NV slumped 5.7% as its sales outlook for the current quarter missed estimates. Nokia Oyj climbed after a better-than-expected fourth quarter. SEB AB slipped as fourth quarter net interest income missed analyst estimates. Publicis Groupe SA rose as revenue beat expectations and the firm said it will invest €300 million ($327 million) in the next three years on artificial intelligence.
The ECB is set to keep borrowing costs on hold for a third meeting while stepping up efforts to convince investors that interest-rate cuts aren't imminent. All eyes will be on President Christine Lagarde, who will speak at 2:45 p.m. in Frankfurt, 30 minutes after the bank's policy announcement.
The earnings season is still in its early days, but 73% of the 12 companies on the MSCI Europe Index that reported through Wednesday have missed earnings-per-share estimates, according to data compiled by Bloomberg Intelligence. Consensus estimates call for negative earnings-per-share growth of 9.2% versus a year ago, the data show.
European stocks have been mixed in January after a strong rally over the previous two months. Investors are monitoring the earnings season closely while assessing monetary policy as well as the health of the economy.
“Coming into 2024, markets got ahead of themselves with rate cut expectations, which we think need to be revised to a later start date,” said Joachim Klement, a strategist at Liberum. “While the ECB is in a much better position to start cutting rates than the Fed given the weak economy and lower inflation, the recent uptick in inflation should be a warning that cutting rates too soon can create the risk of further inflation increases later in the year.”
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