The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, April 30, 2024. REUTERS/Staff/File Photo Purchase Licensing Rights, opens new tab
May 2 (Reuters) – European shares flitted in a tight range on Thursday, after falling to a one-week low in early trade, as investors returned from a mid-week holiday to gauge a slew of earnings and the Federal Reserve signalling a delay in interest rate cuts.
The pan-European STOXX 600
held its ground at 503.55, as of 0830 GMT, after logging its first monthly decline this year in April.
Market sentiment has come under pressure as investors navigated through risks surrounding the Middle East geopolitical conflict, the European Central Bank’s policy outlook beyond June, and the corporate earnings season.
European equities were closed on Wednesday due to Labour Day holiday, a day that saw the U.S. Fed signal rates would stay higher for longer owing to recent disappointing inflation readings.
“The latest official stance supports the notion that there will be a delay in the timing of the first rate cut, but not a pivot back to tightening … Our base-case is for a total of 75 bps of cuts this year,” OCBC strategists wrote.
As for domestic monetary policy, Spanish policymaker Pablo Hernandez de Cos noted the ECB is growing increasingly confident that euro zone inflation can drop to 2% target by mid 2025 after a choppy few months between now and then.
Energy stocks
dropped 1% to a near one-month low. World’s largest wind turbines maker Vestas
lost 2.5% after a surprise first-quarter loss while France’s Technip Energies
shed 4.1% after first-quarter results.
Danish drugmaker Novo Nordisk
lost 2.4% despite a first-quarter beat and outlook hike, with analysts pointing to slower underlying growth and weakness in obesity drug sales.
Shares of Danish shipping giant Maersk
dropped 3.7% after a first-quarter earnings before interest and taxes (EBIT) miss.
Spanish bank Sabadell
jumped 6.4% after receiving a merger proposal from bigger rival BBVA
, whose shares were down 1.9%.
On the flip side, Netherlands’ ING Groep
jumped 6.4% after a 2.5-billion-euro ($2.68 billion) share buyback and a strong first-quarter performance, and Britain’s Standard Chartered
climbed 5.5% following a first-quarter profit beat, boosting the bank index
to top the sectoral gainers’ list.
French office services and call centre company Teleperformance
soared 11.1% following higher first-quarter sales.
Danish hearing-aid company GN Store Nord
surged 14.1% after better-than-expected first-quarter earnings.
Bayer
climbed 4.8% after its Monsanto unit won an appeal over a $185-million verdict related to now-banned chemicals called polychlorinated biphenyls.
Meanwhile, a survey showed the ongoing downturn in euro zone manufacturing activity deepened in April, pushing firms to reduce headcount again.
Sign up here.
Reporting by Ankika Biswas in Bengaluru; Editing by Sonia Cheema and Sherry Jacob-Phillips
Our Standards: The Thomson Reuters Trust Principles., opens new tab
