December 9, 2022

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European Stocks Close Higher On Hopes Fed Would Slow Down Pace Of Rate Hikes

2 min read

European stocks closed higher on Thursday with several key indices from the region rising to multi-month highs, thanks to positive reaction to the Federal Reserve’s minutes which have raised hopes the central bank will likely slow its pace of interest rate hikes from next month.

According to the FOMC meeting minutes, a majority of policymakers found that a slower pace of interest rate hikes would “likely soon be appropriate.”

“A slower pace in these circumstances would better allow the committee to assess progress toward its goals of maximum employment and price stability.”

Worries about a surge in Covid cases in China capped markets‘ gains. Investors also digested the minutes from the European Central Bank’s latest policy meeting, and the latest batch of economic data from the region.

Minutes from the ECB’s last meeting showed policymakers remained committed to raising rates, even in case of a recession.

However, the minutes showed no reference to another 75-basis point rate hike in December. The minutes showed that the future path should be based on the ‘evolving outlook for inflation and the economy, following a meeting-by-meeting approach.’

The pan European Stoxx 600 gained 0.46%. Germany’s DAX climbed 0.78% and France’s CAC 40 gained 0.42%, while the U.K.’s FTSE 100 edged up 0.02%. Switzerland’s SMI advanced 0.57%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Greece, Norway and Poland ended notably higher.

Iceland, Ireland, Netherlands, Portugal edged up marginally. Sweden closed weak, while Russia, Spain and Turkiye ended flat.

In the UK market, Intertek Group surged more than 4.5%. United Utilities, Rolls-Royce Holdings, Airtel Africa, Segro, ICP, Hargreaves Lansdown, Natwest Group, Schrodders, IAG, Associated British Foods and RightMove gained 1.5 to 3.2%.

Imperial Brands drifted down nearly 4%. British Land, Vodafone Group, RS Group and National Grid also ended notably lower.

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2022-11-24 12:53:29

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