EUROPE MARKETS: European Markets Respond Positively To Fed Announcement

By Emily Horton

Europe's major markets were up on Thursday, as investors responded well to the U.S. Federal Reserve's indication that it may be finished with rate increases for now.

Telecommunication stocks were under pressure.

How did markets perform?

All major European indexes were in the green on Thursday, with the Stoxx Europe 600 adding 0.5% to 360.14, after finishing up 0.4% on Wednesday.

Germany's DAX 30 (DAX) was the top regional gainer, adding 1% to 11,289.58.

The FTSE 100 was up by 0.7% to 6,989.59, France's CAC 40 added 0.7% to 5,011.21 and Italy's FTSE MIB Italy index rose by 0.4% to 19,840.64.

The euro was up on Thursday, fetching $1.1489 from $1.1482 late on Wednesday night in New York. Meanwhile, the pound rose slightly to $1.312 from $1.3114.

What drove the markets?

On Wednesday the U.S. Federal Reserve indicated it is holding any further interest rate rises (http://www.marketwatch.com/story/why-stocks-surged-yields-fell-and-the-dollar-tanked-after-the-feds-dovish-pivot-2019-01-30), citing muted inflation. Trade talks between Chinese and U.S. officials also kicked off in Washington.

Official data on Thursday is likely to show that Italy is heading back into recession, adding to concerns over a European slowdown. Data on Europe's GDP and French inflation rates are also expected later.

Jean-Claude Juncker, the president of the European Commission, has warned U.K. Prime Minister Theresa May that any attempt to reopen Brexit negotiations with the EU will increase the chance of a disorderly Brexit, the Financial Times reported (https://www.ft.com/content/20e26db2-24af-11e9-8ce6-5db4543da632).

What shares were active?

Telecommunication stocks were under pressure on Thursday. Nokia Corp (NOK) announced it expects bumpy growth during 2019 due to the timings of 5G rollouts, Reuters reported (https://www.reuters.com/article/us-nokia-results/nokia-sees-strong-2019-profit-idUSKCN1PP0IZ), leading to a 5% fall in the telecoms equipment maker's stock.

Meanwhile, BT Group PLC (BT.A.LN) dropped by almost 3% on the news that the company's adjusted earnings and revenue both declined (http://www.marketwatch.com/story/bt-group-beats-forecasts-despite-earnings-fall-2019-01-31) in the third quarter of fiscal 2019.

Unilever (ULVR.LN) lost 3% after it warned of a tough year ahead (http://www.marketwatch.com/story/unilever-warns-of-tough-2019-ahead-2019-01-31).

In oil stocks, Royal Dutch Shell PLC A (RDSA.LN) reported a profit rise (http://www.marketwatch.com/story/shell-profit-rises-on-higher-oil-gas-prices-2019-01-31), adding just under 4% to the company's stock.

Diaegeo PLC (DEO) gained almost 4% after it approved further buybacks (http://www.marketwatch.com/story/diageo-lifts-buybacks-as-tax-rise-hits-profits-2019-01-31).

Fashion retailer Hennes & Mauritz AB's (HM-B.SK)missed its forecast (Hennes%20%26%20Mauritz%20AB%27s) on Thursday, leading to a 1% drop in its share price.

(END) Dow Jones Newswires

January 31, 2019 05:57 ET (10:57 GMT)

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