Europe midday: Stocks pare losses after ECB surprises on bond purchases
By Alexander Bueso
Date: Thursday 04 Jun 2020
(Sharecast News) - Stocks came off their lows of the session after the European Central Bank surprised markets with a larger-than-expected increase in its bond buying programme against the pandemic, known as PEPP.
That coincided with the announcement overnight of an also larger-than-expected second stimulus programme from Berlin worth €130bn, versus the €50-100bn figure that various reports had bandied about throughout the previous week.
Against that backdrop, as of 1315 BST, the German Dax was down by 0.24% to 12,459.35, alongside a 0.04% dip for the French Cac-40 to 5,020.69, while the FTSE Mibtel was up by 0.24% at 19,689.07.
In parallel, the yield on the benchmark 10-year German bund was flat at -0.36%, having earlier risen as high as -0.33%.
Euro/dollar meanwhile was 0.08% higher following the ECB's announcement at 1.1252, versus where it was at beforehand at 1.1195.
To take note of, Thursday's slight losses for stocks followed three consecutive sessions of sharp gains across the Continent that had seen shares rise to roughly three-month highs.
The new stimulus package approved in Germany centred around temporary reductions in value added tax, investment in 5G data networks and railways, and a doubling of incentives for electric cars.
Elsewhere on the economic front, euro area retail sales plummeted at a 11.7% month-on-month clip in April (consensus: -15%).
And in Greece, Elstat reported a 1.6% quarter-on-quarter contraction in first quarter gross domestic product, as capital investment shrank by an outsized 8.4% and with net imports acting as a further drag.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN