EUROPE MARKETS: European Stocks Rise For 4th Day In A Row As ECB Steals Focus From U.S. Tariffs
March 08 2018 - 4:24AM
Dow Jones News
By Sara Sjolin, MarketWatch
Casino shares slide after earnings
European stocks rose for a fourth straight session on Thursday,
with traders shrugging off concerns over U.S. tariffs and instead
looking ahead to the European Central Bank's closely watched policy
decision later in the day.
No action is expected at the ECB meeting, but all eyes are on
the central bank's statement for any tweaks to its easing bias.
What are the markets doing?
The Stoxx Europe 600 index rose 0.2% to 373.54, building on 0.4%
gain from Wednesday
(http://www.marketwatch.com/story/european-stocks-lose-ground-after-cohn-leaves-white-house-role-2018-03-07).
Germany's DAX 30 index gained 0.1% to 12,256.15, while France's
CAC 40 index climbed 0.2% to 5,199.31.
The U.K.'s FTSE 100 index was slightly lower at 7,155.41.
The euro fell to $1.2401 from $1.2411 late Wednesday in New
York.
What is driving the market?
The upbeat trading mood came as tensions over the planned U.S.
tariffs on steel and aluminum imports eased after comments from the
White House that major trading partners Canada and Mexico could be
exempt. President Donald Trump is expected to sign the tariff order
on Thursday, with an announcement planned for 3:30 p.m. Eastern
Time, according to media reports
(http://www.marketwatch.com/story/trump-tariff-plan-expected-to-exempt-canada-mexico-after-house-republicans-protest-2018-03-08).
Closer to home, traders looked ahead to the ECB's policy
decision for any hints on the future of monetary policy. The
central bank is widely expected to keep rates and its a key
stimulus program on hold, but the big question is if the rate
setters are changing their forward guidance.
According to the current forward guidance, the quantitative
easing program is currently slated to run "until the end of
September 2018, or beyond if necessary," with the bank standing
ready to "increase the asset purchase program (APP) in terms of
size and/or duration," if the economy turns sour. If the ECB
removes these sentences from the statement, it's seen as a hawkish
shift and likely to send the euro higher, according to
analysts.
Read:Here's the case for an unexpected tweak to the ECB's policy
guidance
(http://www.marketwatch.com/story/heres-the-case-for-an-unexpected-tweak-to-the-ecbs-policy-guidance-2018-03-07)
"Will they now say for sure that [QE will] end in September? Or
will they say they'll end at some specific time after September? Or
will they just announce that there will be a further reduction at
some point, but leave the end point vague? That's going to be the
focus," said Marshall Gittler, chief strategist at ACLS Global, in
a note.
"The more certainty there is about the end, the better it will
be for EUR. The market assumption is currently that the ECB will
end its QE program at the end of this year. Nonetheless, an
announcement in line with that vague consensus would probably boost
EUR by eliminating the uncertainty," he added.
The ECB announces its policy decision at 12:45 p.m. London time,
or 7:45 a.m. Eastern Time, followed by central bank chief Mario
Draghi's news conference at 1:30 p.m. London time.
Which stocks are in focus?
Shares of JCDecaux SA (DEC.FR) slid 8.4% after the outdoor
advertising company said profit slumped 14% on 2017
(http://www.marketwatch.com/story/jcdecaux-profit-falls-14-in-2017-on-tax-charge-2018-03-08-14854617).
Aviva PLC (AV.LN) dropped 2.3% after reporting a 2% rise in 2017
adjusted operating profit
(http://www.marketwatch.com/story/aviva-profit-rises-2-in-2017-to-return-500-mln-2018-03-08).
Casino Guichard-Perrachon SA (CO.FR) fell 1.8% after the French
retailer posted a sharp drop in 2017 profit
(http://www.marketwatch.com/story/casino-profit-slumps-in-2017-as-sales-tick-up-2018-03-08).
Shares of Hugo Boss AG (BOSS.XE) lost 5% even after the German
fashion company said it would raise its 2017 dividend
(http://www.marketwatch.com/story/hugo-boss-plans-to-raise-dividend-as-profit-rises-2018-03-08)
after net profit rose in the full year.
What's new in economics?
German manufacturing orders fell more than expected
(http://www.marketwatch.com/story/german-manufacturing-orders-drop-miss-forecasts-2018-03-08)
in January, dropping 3.9%, compared with forecasts of a 1.5%
decline.
In France, the Bank of France said the country's economy is
likely to expand by 0.4% in the first quarter
(http://www.marketwatch.com/story/french-gdp-to-rise-04-on-quarter-bank-of-france-2018-03-08),
down from 0.6% in the fourth quarter of 2017.
(END) Dow Jones Newswires
March 08, 2018 05:09 ET (10:09 GMT)
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