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Market Update

European Stocks Pare Early Gains

European stocks pulled back from early highs Tuesday as investors positioned themselves ahead of key policy announcements later in the week.

The FTSE was trading flat at 9:57 a.m. London time, the CAC40 Paris slipped 0.1% while the DAX Frankfurt was up 0.7% at the time of writing.

Sentiment was positive at open as some upbeat corporate results in the region boosted confidence.

But most of these gains soon fizzled out as investors turned cautious ahead of some key policy announcements from global bankers. The U.S. Federal Reserve was due to start its two-day policy meeting later today, and was widely expected to extend its asset-purchase program.

Similarly, traders were hoping the European Central Bank would slash its benchmark interest rate later in the week.

Stocks on the move

On the earnings front, London-listed BP plc. bounced nearly 4% after reporting first quarter profit of $17 billion.

Deutsche Bank AG soared 7.4% after the banking giant said it would raise 5 billion euros in capital even as it reported a 19% hike in first-quarter earnings.

Other financial stocks in the region were also trading higher. Commerzbank AG tacked on a percent while London-based Lloyd Banking Group Plc. jumped over 4% on the back of strong results.

Among French lenders, Credit Agricole SA added 1.2% while Societe Generale SA climbed 2.4%.

On the downside, Audi AG slipped 0.8% after the company reported a decline in first-quarter sales, and a drop in pretax profit due to expenses on new products and technology, as well as capacity expansion.

FMCG giant Unilever dropped 1.3% after the company announced plans to raise stake in its Indian unit for as much as $5.4 billion.