Europe’s main stock markets hit the pause button yesterday as investors mulled the European Central Bank’s reticence on future stimulus moves.
In the eurozone, Paris stocks drifted 0.09% lower at the close with the CAC index touching 4,536 points, while Frankfurt shares rose just 0.09% and the DAX 30 hit 0.09% at 10,710 points.
Milan stocks ended the day up 0.15% as shares in troubled bank Monte Paschi di Siena rocketed ahead of a new business plan, which will be unveiled on Monday. The stock closed up 13% yesterday, and has soared nearly 40% this week – though it remains 80% below its price at the start of the year.
London’s benchmark FTSE 100 index closed 0.09% down at 7,020 points after British American Tobacco shares gave up their earlier gains to finish 2.85% lower.
The group has launched a blockbuster $47bn (€43bn) bid for control of US peer Reynolds American but the stock’s gains unwound on reports it could be rejected.
“The $56.50 per share offer is just above the record high for Reynolds shares reached in June, and given that no formal discussions have yet been had between management, could be rebuffed,” said Jasper Lawler, market analyst at CMC Markets.
US stocks were mostly lower yesterday, but Microsoft surged to an all-time high after reporting first quarter results that were well above expectations.
Around mid-day in New York, The Dow Jones Industrial Average fell 0.2% to 18,124.45 points.
The broad-based S&P 500 also dropped 0.2%, while the tech-rich Nasdaq Composite Index was up a slight 0.27%.
European equities had climbed higher on Thursday after the ECB opted against changing the size and scope of its bond-buying stimulus programme.
ECB chief Mario Draghi had dismissed reports the bank was considering gradually tapering its stimulus, but he added it was “unlikely” there would be an abrupt end to bond purchases.
The ECB stimulus scheme, known as quantitative easing (QE), involves the purchase of public and private bonds at the rate of €80bn per month, and is currently set to end in March 2017.
Asian markets diverged yesterday following news of a strong earthquake in Japan.
Computer-controlled orders are programmed to react instantly to news of earthquakes measuring greater than 6.0 magnitude or so, he told Bloomberg News.
Tokyo’s Nikkei 225 index, which was up at the lunch break, slipped 0.30% to end a five-day winning streak.
Markets in Hong Kong were closed for the day as Typhoon Haima lashed the city, forcing schools and many businesses to shut.