- Eurozone services PMI revised down
- Eurozone economy grows as expected
- US ADP jobs report misses forecast
- US services PMI falls
FTSE 100: -0.26%
CAC 40: -0.06%
FTSE MIB: -0.16%
IBEX 35: -0.20%
Stoxx 600: 0.02%
European stocks were little changed following the release of reports on Eurozone service activity and euro-area economic growth.
Markit's services purchasing managers' index (PMI) for the euro-area in May was revised down to 53.2 from the flash estimate of 53.5, but it remained above the 50 level that indicates expansion and April's 53.1.
Another report confirmed the Eurozone economy grew by 0.2% in the first quarter, as forecast.
The data comes a day ahead of the European Central Bank (ECB)'s policy meeting which is expected to reveal monetary easing to tackle inflation, which at 0.5% remains well below the 2% target.
Chief UK and European Economist at IHS Global Howard Archer said he sees the ECB cutting interest rates by 10 to 15 points, including taking its deposit rate modestly into negative territory.
He also predicts the ECB may possible do a Long-Term Refinancing Operation (LTRO) which is tailored specifically towards lifting bank lending to the private sector (especially smaller companies).
"The ECB could also stop sterilising the money it spent buying sovereign bonds during the Eurozone's debt crisis under its now-terminated Securities Markets Program (SMP)," he said.
"However, we remain doubtful that the ECB will undertake full blown quantitative easing. We suspect this will only happen if Eurozone consumer price inflation falls to new lows over the coming months and Eurozone growth falters markedly."
In the UK, Markit and the Chartered Institute of Purchasing & Supply (CIPS) said its index for services activity fell to 58.6 in May from April's 58.7, but ahead of forecasts.
American employers added 179,000 jobs in May, according to the ADP Research Institute today, compared to 220,000 the previous month. Economists had pencilled in 210,000 workers.
A final report from Markit showed US services PMI fell to 58.1 in May, from 55 in April. It was revised down from the flash estimate of 58.4.
A separate report from Institute for Supply Management said its composite index, which evaluates manufacturing and services activity, rose to 56.3 in May from 55.2 the previous month. Analysts had expected a reading of 55.5.
In other economic data, US non-farm business sector labour productivity in the first quarter of 2014 was revised lower to show an annual fall of 3.2%, the Bureau of Labor Statistics said, as hours increased by 2.2% and output declined 1.1%. This was the largest drop in productivity since the first quarter of 2008.
Meanwhile, the US trade deficit increased by 6.9% to $47.2bn in April, its highest in two years, according to the Commerce Department. This was up from a revised $44.2bn in March and surprised analysts looking for a fall to $40.6bn.
After the close the Federal Reserve was due to release its Beige Book.
Repsol, Telecom Italia
Repsol slipped after Petroleos Mexicanos sold a 7.9% stake in the Spanish oil company at €20.10 a share.
Telecom Italia gained after broker Kepler Cheuvreux SA said Italy has the best potential among large European economies for recovery in productivity and profitability.
Volkswagen dropped after selling preferred shares
at €191 each to institutional investors as part of funding its acquisition of Swedish truckmaker Scania.
Dufry advanced after agreeing to buy travel retailer Nuance Group for $1.73bn.
Tesco declined as the UK supermarket reported a fall in first-quarter like-for-like sales.
The euro fell 0.07% to $1.3618.
Brent crude futures edged down $0.295 to $108.500 per barrel, according to the ICE.