Europe close: Markets inch higher but caution sets in ahead of Fed, Big Tech earnings

(Sharecast News) - European stock markets finished mostly higher on Wednesday, though upside was limited following a mixed reaction to bank earnings and uncertainty ahead of some key risk events.

Investors were largely shrugging off another rise in oil prices, with front-month Brent crude futures surging 2.5% to $112.12 a barrel.

The Stoxx 600 finished higher for the third day but rose just 0.1% to 644.14, with gains in London, Frankfurt and Milan partly offset by losses in Madrid and Zurich and a flat finish in Paris.

The Federal Reserve was set to make its latest policy announcement at 1800 GMT, though policymakers are widely expected to keep rates steady. Central bank meetings were on tap in the UK and Japan on Thursday and Friday, respectively, while the Bank of Canada voted on Wednesday to lift interest rates for the first time in three years.

Wall Street was also gearing up for the latest round of Big Tech earnings, with Microsoft and Alphabet results expected after the closing bell. Amazon.com will report results on Thursday, while investors were keeping their eyes peeled for the latest earnings from chip and hardware stocks such as Intel and SanDisk.

"Tonight's tech earnings have the capability to drive continued gains for tech stocks even as oil prices rise, though it is going to be a tough sell," said Chris Beauchamp, chief market analyst at IG.

"The market now spends its time worrying about spending levels among these heavyweights, but now it seems to worry about them spending both too much and too little. Caught between these two poles, tech CEOS find themselves having to chart a very tricky course tonight."

Back in Europe, investors were digesting a barrage of earnings reports from the banking sector, with Standard Chartered, Deutsche Bank, BNP Paribas, Santander and UBS among those publishing third-quarter results.

Standard Chartered gained in London after reporting a 29% increase in Q3 pre-tax profit at constant currencies to $2.3bn, as operating income rose 14% excluding notable items to $5.8bn, helped by a strong performance from Wealth Solutions and Global Markets. The emerging markets-focused lender now expects full-year operating income growth to exceed its previous guidance range of 5% to 7%.

Deutsche Bank was higher in Frankfurt after reporting a better-than-expected 8% rise in Q3 pre-tax profit to �2.6bn. Revenue increased 4% to �8.3bn, while the German lender reaffirmed its ambition to generate more than �33bn in revenue for the full year.

BNP Paribas was little changed in Paris despite reporting a 13.5% increase in Q3 net income to �3.5bn, supported by a 9.5% increase in revenue to �13.76bn. The French banking group also announced plans to launch a �1.3bn share buyback in November.

UBS fell in Zurich as investors were underwhelmed with an 8% increase in Q3 net profit to $2.7bn, driven by wealth management inflows and stronger equities trading.

Meanwhile, Santander was providing a drag in Madrid, with markets shrugging off a 19% increase in Q3 underlying pre-tax profit, as reported profits declined 2% due to restructuring and impairment charges while loan-loss provisions increased.

Outside of the banking sector, shares in Stellantis surged in Milan after the auto giant reported a sharp narrowing of third-quarter losses as revenues increased, with the Jeep and Peugeot owner reaffirming its full-year guidance despite volatile conditions for the car industry.

In macro news, Germany's GfK consumer climate index slipped to a six-month low of -30.8 points for November from -30.6 in October, though slightly ahead of the -30.9 consensus forecast. The index remained well below its year-earlier level of -22.5, as concerns over inflation and household finances continued to weigh on spending intentions despite improving economic expectations.

Meanwhile, UK investors were focusing on Chancellor John Healey's first Autumn Budget, with banks and gambling stocks higher, but housebuilders under the cosh as details of the government scheme for first-time buyers failed to impress.