LONDON — European stocks were mixed on Tuesday morning as global markets prepare for the U.S. Federal Reserve’s two-day meeting, which begins today, and investors digest a slew of earnings.

The pan-European Stoxx 600 slid 0.1{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} below the flatline by mid-morning, with travel and leisure stocks bouncing 2.1{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} while autos and insurance stocks slid 0.8{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6}.

European markets are breaking slightly from the trend seen overnight Asia-Pacific, where stocks mostly declined as concerns about the spread of Covid-19 lingered.

Elsewhere, U.S. stock futures held steady in early premarket trading on Tuesday as investors braced for another batch of corporate earnings. Key companies such as Alphabet, Microsoft, Starbucks and AMD report after the bell.

Global markets will be watching the U.S. Federal Reserve this week as it kicks off its two-day policy meeting on Tuesday. The central bank is not expected to take any action, but investors will pay close attention to comments from Chairman Jerome Powell, particularly regarding inflation.

Investors will be digesting the latest earnings from HSBC, Europe’s largest lender by assets, which reported first-quarter pre-tax profits that beat estimates but its revenue was down.

“HSBC swallowed a bitter pill by setting aside $3 billion for bad loans provisions last year, but now the pandemic headache is easing it’s releasing £400 million of that cash,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

She noted that the 79{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} jump in profits was fueled in part by the improved economic outlook on the back of rapid vaccine rollouts and helped by the crutch of government emergency support, providing a “welcome relief” for the bank.

“But there doesn’t look like there is an immediate cure for the bank’s underlying ailment, the ultra-low rates plaguing the banking sector,” she added.

“HSBC is not alone in feeling the squeeze of net interest margins, which tightened again slightly over the quarter, but other banks with huge investment banking arms have been able to capitalize on the trading surge over the past year.”

Earnings in focus

Sweden’s Evolution Gaming climbed 10.5{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} to lead the Stoxx 600 after comfortably beating first-quarter earnings forecasts, while Denmark’s DSV Panalpina jumped 8.4{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} after announcing a $4.1 billion deal to buy the logistics division of Kuwait’s Agility Public Warehousing.

At the bottom of the European blue chip index, French biotech firm Biomerieux plunged 9{98cae0078f524eff3ab8ec32cf55b261677ef6c8a6ed6e94d92a4234b93f46b6} after downgrading its 2021 growth targets.

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