PARIS (Reuters) – European stock markets ended lower on Thursday after the meeting of the European Central Bank, under pressure from disappointing results and after a better-than-expected US GDP growth figure.
In Paris, the CAC 40 declined by 0.38% to 6,888.96 points, while the German Dax fell by 1.08% and the British Footsie by 0.81%.
The EuroStoxx 50 index ended the session down 0.59%, compared to 0.5% for the FTSEurofirst 300 and 0.48% for the Stoxx 600.
The ECB decided on Thursday to keep its key rates unchanged, but the central bank warned that the euro zone economy was weakening, while the war in the Middle East made the evolution of energy prices uncertain – and, hence, their impact on inflation.
However, the ECB reiterated that a pause did not equate to the end of its cycle of rate increases, while ruling out any possibility of a rate cut for the moment. The numerous company results considered disappointing also contribute to pushing the stock indices down: in Europe, the banking sector is falling, profits linked to high rates being destined to decline, while the decline of major technology stocks in the United States United weighs.
Furthermore, American GDP in the third quarter surprised on the upside, its growth over one year reaching 4.9% against 4.3% forecast by the consensus, rekindling fears that the Federal Reserve will have to raise its rates further to avoid overheating of the American economy.
PCE inflation, the price gauge the Fed relies on to determine whether inflation is on target, is due Friday at 12:30 GMT, and a further upside surprise would further limit appetite for the risk.
VALUES
Plastic Omnium plunged 22.82% after lowering its annual operating margin and free cash flow outlook on Thursday, citing a tense macroeconomic and market context.
Several major European banks fell after a series of earnings releases that disappointed investors. The European banking index fell 0.53% and reached its lowest level in four months during the session. Standard Chartered fell 12.44%, Swedbank 6.94% and BNP Paribas fell 2.60% as the bank’s results were poorly received.
Carrefour advanced 4.74% after the publication of better-than-expected quarterly turnover and the maintenance, considered reassuring, of financial objectives for 2023. Danone raised its turnover growth forecast for 2023 on Thursday , the increase in prices having only a slight impact on volumes, and gained 2.42%. Siemens Energy tumbled 35.49% to its all-time low and trailed the Stoxx 600 after the company confirmed talks with the German government over state guarantees and signaled expectations of its Siemens Gamesa wind unit were at risk.
A WALL STREET
Wall Street is falling, under pressure from better than expected economic growth figures in the third quarter in the United States.
At closing time in Europe, trading on the New York Stock Exchange indicated a decline of 0.33% for the Dow Jones, compared to 0.69% for the Standard & Poor’s 500 and 1.31% for the Nasdaq. Composite.
RATE
Yields in Europe declined thanks to the ECB meeting, including a commitment to continue reinvestments from its Pandemic Emergency Purchase Program (PEPP) until the end of next year, as planned, supports the bonds.
At the close of the European interest rate markets, the ten-year Treasury yield lost 4.9 bp to 4.9039%, while the two-year rate dropped 6.5 bp to 5.0561%. The yield on the German ten-year fell 3.5 bps to 2.852%, while that of the two-year rate fell by 5.4 bps to 3.128%.
CHANGES
The dollar strengthens after better-than-expected GDP figures in the United States.
The dollar rose 0.29% against a basket of reference currencies, while the euro lost 0.27% to 1.0534 dollars. The pound sterling is stable at $1.2115.
OIL
Crude is in sharp decline after an increase in American crude inventories, which signal a weakening of demand across the Atlantic.
Brent fell 1.64% to $88.65 per barrel, American light crude (West Texas Intermediate, WTI) fell 1.76% to $83.89.
(Written by Corentin Chappron, edited by Jean-Stéphane Brosse)
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