Europe Stocks Little Changed After 3-Day Loss as Oil Shares Gain

European stocks were little changed, while energy companies rebounded after a three-day decline.
The Stoxx Europe 600 Index slipped 0.1 percent to 339.01 at 9:09 a.m. in London. A gauge of energy shares advanced from a three-year low, led by gains in Total SA and BP Plc. The measure slumped 27 percent from a June high through yesterday, with Brent falling deeper into a bear market after OPEC said it sees demand for crude in 2015 at the weakest level in 12 years.
“Although investors are having all kinds of uncertainty thrown at them, the case for investing has not changed,” Francois Savary, chief investment officer of Reyl & Cie., said by phone from Geneva. “The U.S. is giving us strong signs of growth and Europe is back on the path of recovery. There is more pessimism coming into the end of this year, but the buyers are still there.”
European stocks have advanced 3.3 percent this year. The Stoxx 600 reached its highest level in almost seven years on Dec. 5, with Germany’s DAX Index rising to a record, amid speculation the European Central Bank will consider quantitative easing at its January meeting. Optimism the ECB will buy government bonds spurred investors to send money in November to a fund tracking the region’s equities for the first time in five months.

ECB Loans

The ECB today issues a second round of long-term loans to the region’s banks, with investors weighing the take-up for cues on the central bank’s policy decisions. Euro-area lenders will borrow about 148 billion euros ($184.3 billion) in targeted longer-term loans, or TLTROs, which are designed to spur lending to the real economy, according to the median estimate in a survey of 24 analysts.
“The issue of liquidity in Europe is key,” Reyl’s Savary said. “For European equities to outperform the U.S., which we think they will, you need to have liquidity in the system. Will there be QE? If the TLTROs are not working, the ECB needs to add to existing instruments and find other ways of increasing their balance sheet.”
Standard & Poor’s 500 Index futures added 0.3 percent before U.S. data that may show the world’s biggest economy is strengthening. Investors are gauging the data before the Federal Reserve’s policy meeting next week. Reports at 8:30 a.m. in Washington may show retail sales rose at a faster pace in November from a month earlier, while initial jobless claims were unchanged last week.
Among stocks moving on corporate news, Inditex SA rose 3.7 percent after the world’s largest clothing retailer reported an increase in nine-month profit and revenue that was in line with analysts’ estimates.
Telecom Italia SpA gained 2.8 percent. Telefonica SA, Oi SA and Claro SA plan to make an offer for Tim Participacoes SA (TIMP3), according to people familiar with the matter. Telecom Italia owns a 67 percent stake in the Brazilian mobile-phone company.
Nutreco NV added 3.7 percent. Cargill, the largest closely held company in the U.S., said it’s considering making a stand-alone bid for the Dutch animal-feed supplier.