European stock markets closed slightly down on Monday as investors poured over the latest quarterly earnings updates from major European and American corporations. Simultaneously, they anticipated the Federal Reserve's forthcoming monetary policy announcement. While the Federal Reserve is anticipated not to alter interest rates, the statement that accompanies the decision and Chair Jerome Powell's subsequent remarks could provide further insight into the potential direction for rates.
Recent economic data has quelled predictions of immediate rate cuts. Indeed, it is now predicted that the central bank will not change rates until at least September. In European trade, the Stoxx 600 index saw a 0.07% increase while the UK’s FTSE 100 ended up 0.09%. However, Germany's DAX and France's CAC 40 fell by 0.24% and 0.29% respectively. Switzerland's SMI also declined by 0.11%.
Other European markets generally performed better, with shares in Austria, Belgium, Finland, Norway, Poland, Portugal, Russia, Sweden, and Turkey making gains. Conversely, markets in Iceland and Spain weakened, and stocks in Denmark, Greece, and the Netherlands remained stable.
In the UK, Anglo American Plc saw a nearly 4.5% stock increase. This follows the company’s board unanimously rejecting a $39 billion takeover bid from Australia’s BHP. The board claimed that the offer drastically undervalued the company and that it was highly unattractive for shareholders. Also, AstraZeneca saw about a 0.7% gain after the company announced advancements with two breast cancer treatments.
On the other hand, German market player Deutsche Bank fell dramatically by about 8.6%. The bank disclosed that anticipated legal costs related to its acquisition of Postbank would negatively impact its second-quarter and full-year profitability. In total, estimated claims and accumulated interest account for roughly 1.3 billion euros.
In France, Eurofins Scientific saw a near 4% stock boost. However, despite a few positive market performances, data reveals that Eurozone economic sentiment deteriorated in April primarily due to industrial sector difficulties. An annual inflation growth of 2.2% was reported in Germany, the lowest since May 2021.