On Thursday’s opening trade, European shares declined as investors went cautious ahead of the euro zone inflation data release, including weaker oil prices pondering minor sector.
Meanwhile, the EURO STOXX 50 dropped by about 0.97%, along with France’s CAC 40 which went down by 1.02%, and Germany’s DAX 30 lost 0.55% amid morning session.
Benoit Coeure, ECB board member announced that there will ne no further rate cut on negative interest rates and ruled out the likelihood of directly financing government stimulus, known as “helicopter money.”
“We will not take rates into absurdly negative territory,” Coeure said. “But we can never rule out further moves.”
Subsequently, financial stocks posted lower such as French lenders Societe General which lost 0.11%, including BNP Paribas by about 0.65%, Commerzbank of Germany lost 0.23%, and Deutsche Bank by 0.53%.
In peripheral lenders such as Intesa Sanpaolo of Italy recoiled by about 0.33%, while Unicredit by 0.92%. Meanwhile, Spanish banks posted lower by about 0.59%, and Banco Santander lost 1.11%.
Furthermore, the Unicredit previously announced that the €1.76 billion rights that will be issued for Banca Popolare di Vicenza might be postponed, which was scheduled for April.
Metro AG declined 1.40% after a sharp gain on Wednesday’s session. Thus, the German retailer is aiming for a split into independently listed firms.
Moreover, Orange SA plunged 1.67%, followed by Bouygues with the lost of 4.02% after announcing an extension of negotiations in order to rebalance their tie-up to the weekend and stated that the talks were "not yet sufficiently advanced".
The commodity-heavy FTSE 100 in London plummet by about 0.62%, led by losses in the mining sector as oil prices were sharply dragged after the U.S. stockpiles posted record-highs in the previous week.
Rio Tinto shares, along with Bhp Billiton fell by about 2.36% and 2.63%, respectively, followed by declines on Glencore of 3.61% and its rival Anglo American company, which lost 4.27%.
In addition to the weakening financial stocks, HBC Holdings dropped by about 0.33% and Lloyds Banking, which fell by about 0.49%. Meanwhile, Barclays posted lower by 1.12%, while the Royal Bank of Scotland stumbled by 1.16%.
On the other hand, Tui AG witnessed shares to climb by 2.92% after announcing a record-high on both bookings and revenue for the summer of this year compared to the prior year.
Carnival has seen shares to rally by about 1.03% after announcing a tripled profit growth amid first quarter, fueled by lower oil prices.
The U.S. equity markets suggest a lower opening trade, as the Dow Jones Industrial Average futures lost about 0.19%, followed by S&P 500 futures, which fell about 0.24%, and the Nasdaq 100 futures posted a 0.30% drop.
How European Shares Weakened
The start-up sell off for numbers of market has been pondered by a nearly equal rebound, and the S&P 500 currently settled in a positive territory for the current year. Meanwhile, shares of Russian and Turkish comprised of double-digit gains, including rallying currencies and bonds, which boosts emerging markets.
Furthermore, investment-grade, and high-yield bonds has substantially restored, while commodities jumped.
However, European stocks remained weak, as the Stoxx Europe 600 index was down by 6.6% for the current year. Mainly European banks were massively hurt, which lost about 19.5%.