European Markets Finish Mixed On Thursday

The major European stock markets moved in a fairly narrow trading range on Thursday before finally finishing on opposite sides of the unchanged line.

The German and French stock markets were mostly higher throughout the session, but London’s FTSE spent much of the day in negative territory ahead of a key monetary policy update from the Bank of England and ultimately finished in the red.

The Bank of England retained its interest rate and quantitative easing program but signaled a modest tightening of monetary policy depending upon improvement in the economy.

The central bank also retained the existing stock of corporate bond purchases at GBP 20 billion and the government bond purchases at GBP 875 billion, taking the size of total quantitative easing to GBP 895 billion.

For the day, Germany’s DAX picked up 52.54 points or 0.33 percent to finish at 15,755.67, while the CAC 40 in France climbed 34.96 points or 0.52 percent to close at 6,781.19 and the FTSE eased 3.43 points or 0.05 percent to end at 7,120.43.

In Germany, Bayer plummeted 7.60 percent, while MERCH surged 6.83 percent, Adidas plunged 6.02 percent, Siemens spiked 2.60 percent, Infineon Technologies jumped 1.78 percent, Deutsche Bank climbed 1.26 percent, Daimler sank 0.70 percent, Deutsche Post added 0.12 percent and Deutsche Telekom rose 0.09 percent.

In London, Rolls-Royce surged 5.87 percent, while Royal Dutch Shell jumped 1.45 percent, Antofagasta tumbled 1.44 percent, Associated British Foods gained 1.38 percent, British American Tobacco sank 0.84 percent, Experian lost 0.74 percent, Tesco dropped 0.64 percent, Vodafone added 0.46 percent, Prudential slipped 0.18 percent and BAE Systems was up 0.07 percent.

In France, Accor spiked 2.63 percent, while Airbus jumped 1.92 percent, Engie climbed 0.90 percent, BNP Paribas advanced 0.77 percent, Sanofi added 0.73 percent, Vivendi gained 0.49 percent, Credit Agricole lost 0.30 percent, Societe Generale fell 0.26 percent, Orange eased 0.07 percent and Carrefour was up 0.06 percent.

In economic news, French industrial production recovered in June, the statistical office said on Thursday, rising 0.5 percent from May, when output was down 0.4 percent. Economists had forecast output to rise 0.6 percent. Manufacturing output advanced 0.9 percent, offsetting May’s 0.6 percent decrease.

Also, the recovery in UK construction output lost momentum in July with slower growth in all three main categories, IHS Markit reported. The sector continues to expand, but the latest reading signaled the slowest overall increase in construction output since February.

Finally, the Czech central bank raised its key interest rate for a second policy session in a row, hiking the two-week repo rate by 25 basis points to 0.75 percent – in line with expectations. The Lombard rate was raised by 50 basis points to 1.75 percent, while the discount rate was left unchanged at 0.05 percent.