Europe midday: Stocks retrace losses, hedge fund managers skittish
Stocks are retracing their losses from the previous day with the aid of a dip in the single currency's value as investors bide their time ahead of the start of the US central bank's annual Jackson Hole symposium on Thursday.
As of 1232 BST, the benchmark Stoxx 600 was 0.48% or 1.78 points higher to 374.50, alongside a rise of 0.73% or 88.21 points to 12,154.09 for the German Dax and a 0.49% or 25.08 point advance in the Cac-40 to 5,112.67.
In parallel, euro/dollar was 0.44% lower at 1.1761 following the release of a weaker-than-expected reading on German economic confidence.
Nevertheless, geopolitics was not far from traders' minds, nor were the US White House's repeated failures at healthcare and tax reform.
"Risk appetite is gradually returning to the markets again on Tuesday, although sentiment is likely to remain very fragile given the events of the past couple of weeks.
"Geopolitical risk may have subsided for now, it still feels like we’re always on the cusp of an escalation between the US and North Korea, especially in a week in which military exercises are being carried out in the South," said Craig Erlam, senior market analyst at Oanda.
As regards the White House, Ray Dalio, the bilionaire founder of the world's largest hedge fund,Bridgewater Associates, said he was "tactically reducing" risk due to his concerns about the administration's ability to navigate internal and external conflicts.
"It seems to me that we are now economically and socially divided and burdened in ways that are broadly analogous to 1937. During such times conflicts (both internal and external) increase, populism emerges, democracies are threatened and wars can occur. I can't say how bad this time around will get. I'm watching how conflict is being handled as a guide, and I'm not encouraged," Dalio wrote in a post to his LinkedIn account.
On the economic front, the ZEW institute's economic confidence index for German slipped by 7.5 points to a reading of 10.0, falling short of market forecasts for a reading of 15.0.
Experts' outlook for the German economy soured in August amid a weaker than-expected export performance by the country and a widening scandal in the automobile sector, ZEW said in a statement.
Meanwhile, an index of consumer confidence in the Netherlands ticked higher in August, rising from 25 points to 26, according to the country's Central Bureau of Statistics.
Still on the economic calendar for later on Tuesday, the FHFA was set to publish its US home price index for the month of June.
Fabio Cerchiai, Atlantia's chief executive, defended his company's bid for Spain's Abertis, adding that the tollroad operator's shares would continue to be listed on the Madrid exchange if his company's buyout offer went forward.
Air Berlin boss Thomas Winkelmann expected to soon have positive news regarding his negotiations with investors, Handelsblatt reported.