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London - European equities fell on Tuesday following some weaker-than-expected updates, with paper maker UPM-Kymmene slipping after announcing results and Commerzbank's plan to raise €1.4bn hurting its shares.
Commerzbank dropped 4% after Germany's No.2 bank on Monday launched a share sale to raise money from institutional investors to bolster its capital.
Investors also traded cautiously ahead of the start of the Federal Reserve's two-day policy meeting on Tuesday. Analysts expect recent soft US data will nudge the US central bank towards a dovish stance on monetary policy. But investors will scrutinise statements for hints about the timing of a rate hike.
The FTSEurofirst 300 index of top European shares was down 0.6% at 1 632.16 points by 10;15, after gaining about 1% in the previous session, dragged down by sharp moves on some individual companies.
"We have seen some mixed earnings reports today, however disappointing results from companies such as UPM-Kymmene have eclipsed some positive results," Christian Stocker, equity strategist at UniCredit in Munich, said.
"The broader stocks market's recent uptrend remains intact, but we need to see a further improvement in company earnings for the trend to remain firmly in place in the coming weeks."
UPM-Kymmene fell 5.9%, the top decliner in the FTSEurofirst 300 index, after its quarterly core profit missed market expectations.
Geberit, which makes toilet flushing systems, dropped 5.4% after reporting a 15% fall in first-quarter net profit.
However, oil major BP bucked the trend and rose 1.2% after reporting higher than expected profit following a hefty increase in refining revenues that offset weak earnings from its oil production division. It also maintained its dividend at 10 cents per share.
"BP is moving into something of a holding pattern, as it positions itself for a potentially prolonged period of lower oil prices," Richard Hunter, head of equities at Hargreaves Lansdown, said.
"The company has reiterated its protective nature regarding the dividend, where a yield of 5 percent is a key attraction given the current interest rate backdrop."
Across Europe, Britain's FTSE 100 fell 0.8%, Germany's DAX dropped 0.5% and France's CAC was down 0.8%.
However, Greece's ATG index extended the previous session's gains of 4.4% and was last up 0.5% after Greek Prime Minister Alexis Tsipras on Monday reshuffled his team handling talks with European and IMF lenders.
