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Oct 29, 2020

European Markets Closing Report: European stocks close lower as ECB hints at further stimulus; Nokia down 20%

 

Elliot Smith


LONDON — European markets closed slightly lower on Thursday after a choppy trading session, as investors digest new lockdown measures in France and Germany and the European Central Bank’s latest policy decision.

TICKER COMPANY NAME PRICE CHANGE %CHANGE VOLUME
.FTSEFTSE 100FTSE5581.75-1.05-0.02964959734
.GDAXIDAXDAX11598.0737.560.32104958370
.FCHICAC 40 IndexCAC4569.67-1.45-0.03120087236

The pan-European Stoxx 600 closed down by nearly 0.2% provisionally, having been higher earlier in the session. Travel and leisure stocks bucked the downward trend to add 2.4% while media stocks fell 1% to lead losses, with most sectors and major bourses sliding into negative territory.

European stocks had suffered their worst single-day drop since late September on Wednesday as Germany and France announced fresh lockdown measures in a bid to fend off the new wave of Covid-19 cases sweeping through Europe. The British government is also under pressure to tighten restrictions with cases doubling every nine days, according to a new study by Imperial College London.

Markets are also skittish ahead of the U.S. election on Nov. 3, soaring coronavirus cases stateside and diminishing hopes of imminent fiscal stimulus. Wall Street suffered its worst sell-off for several months on Wednesday with the Dow dropping 934 points.

On Thursday, U.S. stocks rose as shares of major tech companies advanced ahead of their quarterly earnings reports. Sentiment also got a lift from better-than-expected economic data.

Back in Europe, the ECB on Thursday opted to hold interest rates steady and keep its broader monetary policy environment unchanged despite the reimposition of fresh lockdown measures across the continent. But it suggested that additional policy action in the euro zone could come as soon as December.

The U.K. on Thursday is expected to lambast both the EU and the U.S. over their “pernicious” trade practices as the country looks to secure post-Brexit trading arrangements with both key allies.

Euro zone economic sentiment was unchanged in October from the previous month, slightly exceeding expectations to come in at 90.6.

Earnings in focus

Corporate earnings remain on investors’ radar, with Credit Suisse on Thursday posting a 38% fall in net profit for the third quarter, as the coronavirus pandemic and “significant foreign exchange headwinds” weigh on the bank’s earnings.

Net income attributable to shareholders came in at 546 million Swiss francs ($600 million), significantly below the 679 million Swiss francs that analysts had expected, according to Reuters Eikon. The Swiss lender’s shares fell nearly 6%.

Oil major Royal Dutch Shell on Thursday reported better-than-expected third-quarter earnings of $955 million and announced plans to increase its dividend to shareholders. Shares traded 4% higher.

German software company Nemetschek was the biggest gainer on the Stoxx 600, adding more than almost 12% after raising its outlook.

At the bottom of the European blue chip index, Finnish telecoms giant Nokia plunged more than 18% after cutting its guidance for 2020 and setting its 2021 target below market expectations.

—CNBC.com staff contributed to this report.

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