European stocks closed lower on Thursday, as some disappointing earnings updates outweighed optimism about interest rate cuts, rendering the mood a bit cautious.
Labor Department’s data on Wednesday showed consumer price inflation in the U.S. increased less than expected in the month of April, raising hopes the Federal Reserve will cut interest rate in September.
The European Central Bank is widely expected to start cutting interest rates from a record high in June, with economists expecting up to three rate cuts this year.
The pan European Stoxx 600 ended down 0.21%. The U.K.’s FTSE 100 edged down 0.08%, Germany’s DAX and France’s CAC 40 closed lower by 0.69% and 0.63%, respectively. Switzerland’s SMI gained 0.4%.
Among other markets in Europe, Austria, Belgium, Greece, Ireland, Portugal, Spain and Sweden ended weak.
Finland, Iceland, Norway, Poland, Russia and Turkiye closed higher, while Denmark and Netherlands ended flat.
In the UK market, BT Group shares soared more than 17% after the new boss of the company set out a path to more than double free cash flow over the next five years.
Future Plc shares zoomed 19%. The publishing company announced a share buyback program of up to 45 million pounds ($57.1 million) after reporting a return to growth in the past quarter.
Burberry Group gained about 3.5%. Prudential, Rio Tinto, Diploma, Phoenix Group Holdings, ICG, Vodafone Group, Sainsbury (J), B&M European Value Retail, Barratt Developments, Centrica, Standard Chartered, Taylor Wimpey, Legal & General, WPP, Glencore, Pershing Square Holdings and Associated British Fods gained 1 to 3%.
Sage Group tanked nearly 10% despite reporting a robust first-half performance. EasyJet drifted down 6% after posting a slightly larger than expected pre-tax loss of £350 million ($443 million) for the first half of the year.
Convatec Group lost 4.1%, while Kingfisher, Croda International, Pearson, Entain, Hikma Pharmaceuticals, Bunzl, GSK, BP, Rolls-Royce Holdings, Shell and Tesco lost 1 to 3%.
In the German market, Siemens shares dropped about 7% after the company posted a drop in its second-quarter earnings at its industrial business.
BMW, Sartorius and Daimler Truck Holding lost 5 to 6%. HeidelbergCement, Infineon, Bayer, Brenntag and Symrise ended down by 1.6 to 2.5%. Deutsche Bank, Covestro, BASF and Siemens Energy also ended notably lower.
In the French market, Safran, Schneider Electric, TotalEnergies, Eurofins Scientific, Saint Gobain, Bouygues, Michelin, Dassault Systemes, Accor, Edenred and Stellantis lost 1 to 2%.
ArcelorMittal climbed nearly 2%. Kering, Thales, Publicis Groupe, Carrefour, Pernod Ricard and Vivendi also closed notably higher.
Market Analysis
European Stocks Close Lower As Weak Earnings Weigh
2024-05-16 17:09:17
