European stock markets ended higher on Thursday, with majority of the stocks rebounding post its recent losses. Investors digested regional inflation data, together with the outlook regarding the central bank rate cuts. DAX index in Germany closed higher, with the index rising 0.48% and CAC 40 in France ended in green, rising 0.52% to sit at ~7,450.63 levels. Continuing our discussion regarding the European stock market news, FTSE 100 closed its session higher on Thursday, as the index saw an increase of 0.53% to close the session at ~7,723.07 levels.
European equities closed lower on Wednesday, as the markets decided to surrender some of the gains which were seen in the late previous year. As a result of these gains, regional indexes reached their two-year highs because investors again considered bets for the US soft landing and quicker-than-expected US Fed rate cuts.
Now, the question is “What has led to this decline in European equities?” Well, we believe that the minutes of the Federal Reserve’s December meeting, which were released on late Wednesday, was the main reason. This is because Wall Street investors though that the minutes did not provide several clues regarding the expected timing of the first rate cut by US Fed. On the positive side, the minutes provided hints that the inflation is under control.
Our readers should know that there is one more reason which supported the momentum on Thursday. Back in Europe, French inflation was softer than expected as consumer prices saw an increase of just ~0.1% on the month in December, exhibiting annual increase of only ~3.7%.
Was the increase seen in European equities supported by stock-specific movements? Well, yes!
Next (LON: NXT) saw an increase of more than ~5% post this U.K. retailer increased full-year profit guidance. This was seen after the company reported that its sales for final 2 months of 2023 came in stronger than anticipated.
While equities saw an increase, what about commodities? Oil prices saw an increase on Thursday, as a result of tensions regarding the oversupply from Middle East.
Moving away from the European stock market news, Chinese stocks closed lower Thursday, with CSI 300 index declining ~0.92% to end the session at ~3,347.05 levels. Hong Kong’s Hang Seng index ended higher by ~0.06% in the final hour of trading.
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