(Bloomberg) -- European stocks were little changed on Tuesday, with investors wary of making bets ahead of this week’s central bank meetings. Brent oil’s rally to $95 triggered worries about inflation spiking again, but boosted the energy sector.

The Stoxx 600 Index was little changed at the close in London. Banks led gains while the retail sector lagged. Energy shares outperformed, with Shell Plc closing at a more than five-year high. European food delivery stocks like Deliveroo Plc slipped in late trading, as rising bond yields put pressure on shares of growth companies, and ahead of the upcoming market debut of a US peer Instacart.

Among other single stocks, Volkswagen AG rose after it got a double-upgrade at Jefferies. Tour operator TUI AG jumped after saying bookings for the winter season are strong, while Societe Generale SA extended declines that followed Monday’s profit warning after getting downgraded by two analysts.

Investors are awaiting a slew of central bank meetings this week starting with the US Federal Reserve on Wednesday, with the recent oil-price rally adding pressure on their decisions. The main regional benchmark fell on Monday after recording the biggest weekly advance in two months last week. Beyond the nervousness about the Fed, investors are also looking ahead to the Bank of England and Bank of Japan’s decisions. 

Oil’s rally has also played an important role in the recent equity selloff, according to Mathieu Racheter, head of equity strategy at Bank Julius Baer. “It increases the pressure on leading central banks right when they are expected to be near the end of the tightening cycle,” he said.

Still, it’s good news for energy stocks in the region. “Energy is our favorite sector as we continue to see further upside for oil given supply concerns and energy stocks so far lagged oil price,” said Marija Veitmane, a senior multi-asset strategist at State Street Global Markets.

Meanwhile, a report that European Central Bank policymakers are considering raising the amount of reserves European lenders must park at the central bank is unwelcome news for the banking sector, Morgan Stanley analysts wrote in a note Tuesday.  


  • European energy-related stocks may be active on Tuesday as global benchmark Brent oil topped $95 a barrel for the first time since November, advancing for a fourth straight day.

For more on equity markets:

  • It’s Getting Hard to Make a Bull Case for Europe: Taking Stock
  • M&A Watch Europe: Edenred, Vopak, ACS, Planisware
  • Sandoz Adds to Flurry of Big Pharma Spinoffs: ECM Watch
  • US Stock Futures Unchanged; Dell Technologies Gains
  • S4 Cuts Outlook as Recession Fears Linger: The London Rush

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--With assistance from Michael Msika.

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