With small gains but on basically positive ground, the main European indices finished trading, with more defensive sectors such as health returning to the fore as concerns about the energy crisis intensify.
In particular, the pan-European Stoxx 600 closed up about 0.2% at 432.04 points, snapping a three-day losing streak and taking a breather from near one-month lows.
As mentioned above, the health sector led the rise with +1%, while on the contrary, the mining sector fell by 1.8%.
In the rest of the European charts, the German DAX closed at 13,220 points with a small increase of 0.2%, the French CAC 40 strengthened by 0.4% with a movement at 6,386 points, but not the British one which fell slightly by 0.17% closing to 7,471 units.
In the markets of the European region, Italy’s FTSE MIB ended at 22,431 points with a slight increase of 0.2%, while Spain’s IBEX 35 fell by 0.3% to close at 8,199 points.
In individual stock moves, UK IT company Aveva rallied a wild 27% after France’s Schneider Group said it was considering a full takeover of it.
In contrast, Swedish security company Securitas fell to the bottom of the Stoxx 600 with losses of 6% after announcing its financial results.
“The continued rise in European gas prices, and the possibility that they will remain extremely high, means that the eurozone is likely to suffer a deeper recession than we previously expected,” said Jack Allen-Reynolds, senior Europe economist at Capital Economics. .
For his part, Graham Secker of Morgan Stanley estimates that “the strong rally in shares worldwide, led by the US, has dragged Europe along, but the outlook on the Old Continent is still very problematic.”
Otherwise, the traders raise stakes that the European Central Bank will resort to more aggressive measures to tame inflation.
As Bloomberg reported, based on swaps tied to ECB decision dates, the market now expects the Bank to raise interest rates by one percentage point by the October meeting, which means the deposit rate will reach 1 %. This is the first time traders have bet on such a sizeable rate hike for the ECB.
More details on the ECB’s plans in the coming months are expected to come from the minutes of the bank’s latest monetary policy meeting, which will be published on Thursday.
Source: Capital
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