Europe close: Stocks flat as investors scale back risk ahead of US elections

(Sharecast News) - European stocks were subdued on Tuesday with the Stoxx 600 finishing flat as investors digested a barrage of underwhelming corporate earnings and awaited news from the US presidential elections, which have the potential to cause some major market volatility in the coming days. While Wall Street opened with big gains in morning trade, European markets were weighed down by heavy falls from the likes of Schroders, Ambu, Vestas, Adecco and Hugo Boss as quarterly results disappointed.

The Stoxx 600 was up just 0.32 points or 0.06% by the close at 509.53, with losses in London and Milan offset by gains in Frankfurt, Paris and Madrid.

Investors' eyes were firmly fixed on Washington DC, with Americans set to pick between former president Donald Trump and current vice president Kamala Harris in the race for the White House. However, mixed poll results in recent days have made the outcome anything but certain.

"If professional pollsters are refusing to call the US election, what hope do global investors have?" said AJ Bell head of financial analysis Danni Hewson.

"There's been some unwinding of so-called 'Trump Trades' in recent days, but no one wants to jump too far only to have to retrace their steps in the aftermath of today's vote, particularly as the outcome could take days, weeks or even months to be finalised."

In economic news, activity in China's services sector picked up more than expected in October, according to a survey released on Tuesday. The Caixin services purchasing managers' index rose to 52.0 from 50.3 in September, coming in above consensus expectations of 50.5 and hitting a three-month high.

Meanwhile, the S&P Global UK services PMI fell to an 11-month low of 52.0 last month, down from 52.4 in September, with respondents citing geopolitical tensions and heightened uncertainty ahead of the Autumn Budget as reasons for delayed spending decisions.

Market movers

In London, Schroders fell 14% despite reporting a record high in assets under management in the third quarter, as large outflows took the shine off the news.

Danish medical devices group Ambu dropped 9% after disappointing the market with its annual report in which it guided to 10-13% organic growth for the year ahead, slightly below the 13.8% rate achieved in the year just gone.

Vestas also dropped 12% in Copenhagen after the wind turbine maker underwhelmed with its interim results, in which it warned that full-year group margins would be at the lower end of the guidance range.

Swiss recruitment firm Adecco saw shares slump 6% after a 21% drop in adjusted EBITA for the third-quarter, much lower than analysts were expecting.

German fashion giant Hugo Boss was also 4% lower after reporting that third-quarter profits fell due to ongoing struggles in the luxury-goods sector.

Meanwhile, German metals producer and recycler Aurubis rallied in afternoon trade to finish up 10%, having now gained 30% over the past three weeks alone. The company was the centre of takeover speculation last month after reports that drugstore entrepreneur Dirk Rossmann had upped his stake in the company.