UPDATE 2-European stocks end flat between earnings optimism, Fed caution

  • Reuters
  • Stock Market News
UPDATE 2-European stocks end flat between earnings optimism, Fed caution
Credit: © Reuters.

* Travel stocks ease from record highs

* Deutsche Bank records best qtr since 2014, tops STOXX 600

* Santander, Lloyds also mark strong quarters

(Updates to market close)

By Sruthi Shankar and Ambar Warrick

April 28 (Reuters) - European stocks ended flat on Wednesday as optimism over a swathe of positive bank earnings was offset by caution setting in before the U.S. Federal Reserve's policy decision.

The pan-European STOXX 600 index .STOXX ended largely unchanged, with bank stocks .SX7P leading gains among the regional sectors. The subindex ended 1.5% higher.

Deutsche Bank DBKGn.DE jumped 10.7% to the top of the STOXX 600, as strength at its investment bank helped the German lender post a better-than-expected first-quarter net profit. bank Santander SAN.MC rose 2.7% after it beat first-quarter forecasts with its profit, while not adding to provisions for the pandemic and booking record U.S. earnings. Banking Group LLOY.L also rose 3.5% after reporting a better-than-expected profit, while Swedish bank SEB SEBa.ST marked small gains on a profit beat. a market level, Europe has performed strongly year-to-date and it's clear that there has been an anticipation that the recovery will be quite sharp and strong," said Tom Dorner, investment director for European equities at Aberdeen Standard Investments. "You're still seeing a rotation in the market in favour of the more cyclical names like banks and autos."

The buying into cyclicals has seen travel and leisure .SXTP , automobiles .SXAP , basic resources .SXPP and banks among the top performing euro zone sectors this year.

However, investors stayed away from making big bets on Wednesday, ahead of the U.S. central bank's policy announcement due at 1800 GMT. Policymakers are widely expected to reaffirm their stance to keep monetary policy loose until enough economic progress has been made. at European companies in the first quarter of 2021 are expected to surge 71.3% from a year earlier, according to Refinitiv IBES data, up from last week's forecast of a 61.2% jump. world's biggest advertising company WPP WPP.L jumped 4.3% to the top of the FTSE 100 .FTSE on returning to underlying growth in the first quarter, as clients launched new products and brands. food delivery company Delivery Hero DHER.DE surged 9.4%, after it forecast revenues to more than double in 2021. decliners, Lysol maker Reckitt Benckiser Group RKT.L fell 3.9% , even as the company backed its full-year outlook. energy service group Saipem SPMI.MI fell 5.1% after it missed quarterly profit estimates and flagged uncertainty over a Mozambique project. communications provider Sinch AB SINCH.ST tumbled 10.8% to the bottom of the STOXX 600 despite a rise in first-quarter profit, as it said that some of its sectors were still under pressure from the pandemic.

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