European markets mixed as traders weigh up corporate results and ECB decision
European stock markets were mixed on Thursday as traders digested a slew of corporate results and a decision from the European Central Bank (ECB) to keep interest rates unchanged.
One of the main narratives of the last few months has been how central banks might start paring back their emergency stimulus programs, as well as hiking interest rates.
On Thursday ECB policymakers also kept the interest rates on the marginal lending facility and the deposit facility at 0.25% and -0.5%, respectively.
Read more: European Central Bank leaves interest rates unchanged
The central bank said that its pandemic emergency purchase programme (PEPP) would be “moderately lower” than in the previous two quarters, with the overall size left at €1.85tn (£1.56tn, $2.14tn) until at least the end of March 2022.
Net buying under the asset purchase programme (APP) will also continue at a monthly pace of €20bn until shortly before the first interest rate hike.
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The rise came despite US third quarter GDP coming in below forecasts. US economic output grew at an annualised rate of 2%, compared with forecasts of 2.6% between July and September, the slowest quarter of growth seen since the first three months of 2020.
“The sharp slowdown in the Q3 growth rate was expected, and we had anticipated it would come in below the consensus of 2%,” Willem Sels, chief investment officer at HSBC, said.
“A reduction in consumer spending and services growth, due to the acceleration of the Delta variant from late July, was the main factor behind the slowdown… Another contributor to the slowdown is the global supply chain issues and subsequent product shortages, which are particularly acute in the automotive sector.”
Meanwhile, initial job claims for state unemployment benefits dropped 10,000 to a seasonally adjusted 281,000 last week, the lowest level since mid-March 2020. The Labour Department revealed it was the third straight week that claims remained below the 300,000 threshold.
On Wednesday US equities dipped from earlier highs, with the Nasdaq closing flat and the S&P 500 falling 0.5%. Only communications and discretionary stocks ended the day in the green, while energy and financials were the biggest laggards.
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Fears over rising inflation sent markets lower in Asia overnight, with the Nikkei (^N225) in Japan falling 1% while the Hang Seng (^HSI) fell 0.4% and the Shanghai Composite (000001.SS) dipped 1.2%
Samsung (005930.KS) posted a 28% jump in profits for the three months to the end of September despite global supply chain issues. The tech company’s sales rose 10% to a record £45.9bn, sending its shares 0.9% higher despite the downturn in the markets.