European stocks grappled for direction Wednesday, as losses for pharmaceutical companies and car makers dragged on the region’s index, even as fresh data painted an upbeat picture of the eurozone economy.
The Stoxx Europe 600 index SXXP, -0.09% was down 0.1% at 382.01, and has been swinging between small gains and losses. The basic materials, industrial and financial sectors were up, but health care, oil and gas and utility stocks struggled.
Equities had trouble finding their footing after falling on Tuesday for the fifth time in six sessions, with risk appetite dented after North Korea said it successfully test-launched an intercontinental ballistic missile.
The geopolitical worries continued Wednesday, as in response, the White House denounced North Korea and demanded global action, while U.S. troops carried out joint exercises with its ally South Korea. U.S. equity trading was closed Tuesday for the Independence Day holiday.
Traditional haven trades, such as gold and the yen, were mixed Wednesday. Gold GCQ7, +0.17% rose 0.3% to $1,222.50 an ounce, while the yen fell against the greenback. The U.S. dollar USDJPY, +0.22% bought ¥113.51, up from ¥113.28 late Tuesday.
Stock movers: Auto makers were under pressure after U.K. car registrations dropped 4.8% in June, according to the Society of Motor Manufacturers and Traders. In Frankfurt, shares of BMW, -0.85% and Daimler AG DAI, -0.93% lost 0.9% and 0.7%, respectively.
Drug maker GlaxoSmithKline PLC GSK, -1.57% moved 1.5% lower following a downgrade to neutral from buy at Citigroup. Fellow pharma Novartis AG NOVN, -1.37% fell 1.4% after it was downgraded to underperform from neutral at Credit Suisse.
Sports apparel maker Adidas AG ADS, +4.38% sprang up 3.6%, to top the Stoxx 600, after a ratings upgrade to buy from hold at HSBC.
Economic docket: Eurozone economic growth likely accelerated over the second quarter, with the average purchasing managers’ index at its highest for more than six years, according to data released by IHS Markit.
That’s despite a month-on-month drop in the eurozone composite PMI for June, which came in at 56.3, compared with 56.8 for May. It was still higher than the 55.7 flash estimate.
German services activity growth eased to five-month low in June, with IHS Markit saying its PMI came in at 54.0, compared with 55.4 in May.
The euro EURUSD, -0.1234% bought $1.1344, little changed from $1.1347 late Monday in New York.
Later Wednesday, minutes from the U.S. Federal Reserve’s most recent meeting will be released. The central bank has largely signaled that it’s still track to raise interest rates again this year.