Updated April 12th, 2024 at 21:22 IST

European shares slip ahead of ECB decision and lagarde remarks

Rate-sensitive sectors such as real estate and banks dipped 0.6 per cent and 1.0 per cent respectively.

Reported by: Business Desk
ECB | Image:Unsplash
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European shares slip: European shares dipped on Thursday as investors exercised caution ahead of a monetary policy decision by the European Central Bank (ECB) and anticipated remarks by ECB President Christine Lagarde on the possibility of interest rate cuts.

The pan-European STOXX 600 index lost 0.3 per cent as of 0906 GMT, with the telecommunications sector leading the declines. Deutsche Telekom's shares dropped 5.5 per cent as the company traded ex-dividend.

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All eyes were on the ECB's decision, expected at 1215 GMT, with the central bank likely to maintain interest rates but drawing attention to any indications of a potential rate cut in June, considering easing price pressures and economic weaknesses.

Rate-sensitive sectors such as real estate and banks dipped 0.6 per cent and 1.0 per cent respectively.

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"The ECB has clearly signalled that it wants to see more evidence of moderating wage growth before it is ready to cut interest rates," said Joost van Leenders, senior investment strategist at Van Lanschot Kempen.

The STOXX 600 hit a one-month low in the previous session following a US inflation report that raised concerns about the Federal Reserve's interest rate plans, potentially leading the ECB to cut rates sooner than expected.

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Societe Generale's shares rose 2.5 per cent after the French lender announced the sale of a professional equipment financing business to rival BPCE for 1.1 billion euros ($1.18 billion).

Despite the overall decline, the oil and gas sector climbed 1.2 per cent, tracking an increase in crude prices.

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However, Idorsia's shares fell 19.2 per cent after the Swiss biotech firm postponed its 2023 and first-quarter results publication.

AstraZeneca's shares rose 1.5 per cent after the drugmaker announced plans to increase its annual dividend by 7 per cent in 2024.

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(with Reuters inputs)

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Published April 12th, 2024 at 21:22 IST