European Stocks Withstand More Downbeat News From Germany

(RTTNews) - European stocks battled back from steep early losses to finish little changed from the previous session Tuesday.

The rally was led by miners and auto makers in spite of news that Germany has slashed its growth forecasts for this year and next.

The economics ministry cut its forecast for economic growth this year to 1.2 percent from an earlier forecast of 1.8 percent, and to 1.3 percent for 2015 from 2 percent previously.

Markets took the news in stride given the alarming economic news to come out of Germany over the past few months.

A report from earlier in the day showed German investor confidence decreased for a 10th month in October to its lowest in nearly two years.

The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations declined to minus 3.6 this month from 6.9 in September.

Another report from Eurostat showed that Eurozone industrial production logged a bigger than expected decline in August after recovering last month. Industrial output fell 1.8 percent from the previous month versus forecasts for a 1.6 percent fall.

The Euro Stoxx 50 index of eurozone bluechip stocks inched up 0.09 percent, but remains down abut 3.5 percent year-to-date, having dropped to its lowest since February.

Around Europe, Germany's DAX was up 0.15 percent, France's CAC 40 added 0.23 percent, and the FTSE 100 of the UK rose 0.42 percent.

Burberry Group shares lost 3.5 percent in London after the company said it expects "slight downward pressure" on margins in the second half.

Brewer SABMiller Plc. lost 1.2 percent after reporting a 5 percent increase in first-half revenues.

Sanofi's shares were flat in Paris. The drugmaker's vaccines division, Sanofi Pasteur, announced the start of a phase III clinical trial in India for its investigational rotavirus vaccine, developed and manufactured by its affiliate Shantha Biotechnics in Hyderabad, India.

Bouygues, Lafarge, Orange and Alcatel-Lucent were among the big French companies poting gains of more than 3 percent.

Iliad rose 9.5 percent after the French telecoms operator said it has dropped plans to buy a majority stake in T-Mobile US Inc., following exchanges with Deutsche Telekom and selected board members of T-Mobile US who have refused to entertain its new offer.

Daimler shares rallied 5 percent in Frankfurt. The car and truck maker reported a free cash flow in its industrial business of about 5.4 billion euros in the third quarter of 2014, up from about 1.6 billion euros in the same quarter last year.

Other auto stocks also pushed higher, with Volkswagen up 2 percent and Continental adding 3.5 percent.