European shares retreat from record rally; earnings, US-China trade on tap

European shares retreated on Tuesday, pausing after a third consecutive record-high close on signs of easing Sino-U.S. trade tensions, as investors assessed a slew of corporate earnings.

The continent-wide STOXX 600 index was down 0.2% at 575.88 points, as of 0810 GMT.

Optimism over a potential U.S.-China trade deal supported markets on Monday. The spotlight will be on a planned meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping in South Korea on Thursday.

The STOXX aerospace & defence index and energy stocks fell 0.8% each, while mining stocks declined 1%.

Bucking the broader downbeat trend, the utilities index rose 0.6%.

Investors also looked forward to major central bank policy announcements scheduled this week. The U.S. Federal Reserve is expected to cut interest rates by a quarter-percentage point on Wednesday, while The European Central Bank is all but likely to keep rates on hold on Thursday.Among corporate updates, BNP Paribas lost 2.9% after the French bank missed third-quarter profit forecasts.Novartis fell 3.4% even as the Swiss drugmaker met third-quarter profit forecast.

Capgemini jumped nearly 7% after the French IT consulting firm raised its growth forecast.