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Europe midday: Stocks off lows despite renewed gains for euro
Stocks are trading on a mixed note, but off their worst levels, even as the single currency continues to gain altitude at a brisk clip.
As of 1350 GMT, the benchmark Stoxx 600 was slipping 0.09% or 0.34 points lower to 398.15, alongside a dip of 0.22% on the Dax to 13,215.30 and of 0.04% in the Cac-40 to 5,514.75.
Meanwhile, euro/dollar was 0.58% ahead at 1.2270, a more than three-year high.
The situation was better out on the periphery, with the Ibex 35 adding 0.17% to 10,480.10 and the FTSE Mibtel rising 0.39% to 23,552.31.
To take note of, US markets would remain closed on Monday, in observance of the Martin Luther King Jr. holiday, which might result in lower than normal trading volumes on bourses.
Last Friday, the euro topped its 2017 high against the US dollar, at 1.2095, and moved past a key level of so-called technical resistance at 1.2170 on the back of optimism around the ability of Germany's main political parties to craft a grand coalition.
In parallel, the US dollar spot index fell to a fresh 52-week low.
Commenting on the interplay between moves in the euro and othe asset classes, analysts at Deutsche Bank said they expected euro area Purchasing Managers Indices to 'fade' as a result of the lagged impact of euro strength and as the inventory cycle turned less favourable.
That, they explained, would be consistent with a "reversal" in recent moves by European stocks, banks and bond yields over coming weeks.
On the other hand, should that "fade" not materialise then that would imply upside for the Stoxx 600 to around 420 towards the start of the second quarter and an increase in bund yields to 80 basis points by the end of the first quarter.
Elsewhere on the economic front, Eurostat reported that the Eurozone's foreign trade surplus recovered from the 19.0bn seen in October to 22.5bn for November (consensus: 23.0bn) on the back of a sharp jump in German exports.
No economic data was due to be published in the US on Monday.
On the corporate front, according to Sueddeutsche Zeitung, Airbus was in talks with German prosecutors to close a probe into the sale of Eurofighter jets to Austria.
In a related sector, at the weekend Air France denied it had bid for failed carrier Alitalia.