European markets muted as investors react to Fed, Bank of England hikes
European stocks were little changed on Thursday as investors reacted to the U.s Federal Reserve's first rate hike in years.
Tekef
LONDON — European stocks were mostly lower on Thursday as investors reacted to the U.S. Federal Reserve's first rate hike in years.
The pan-European Stoxx 600 hovered 0.3% below the flatline by early afternoon, with autos shedding 2.1% to lead losses while oil and gas stocks added 1.2%.
Global markets were digesting the Federal Reserve hiking its benchmark interest rate for the first time since 2018 and signaling six more hikes this year.
U.S. stock futures were muted in early premarket trade as investors also assessed the latest projections from the Fed, which significantly raised its projections for inflation in 2022.
Shares in Asia-Pacific rose on Thursday as Chinese markets continued to extend gains from a rebound, with Hong Kong's Hang Seng index surging more than 6% to erase heavy losses earlier in the week.
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The war in Ukraine is also dominating headlines. Reports of progress on ceasefire negotiations helped boost stocks on Wednesday and after Ukrainian President Volodymyr Zelenskyy delivered an emotive address to the U.S. Congress, President Joe Biden also approved additional weapons to be sent to Ukraine.
The Bank of England on Thursday raised interest rates for the third consecutive meeting and struck a dovish tone as the Russia-Ukraine conflict is expected to keep inflation higher for longer.
The Bank's Monetary Policy Committee voted 8-1 in favor of a further 0.25 percentage point hike to its main Bank Rate, taking it to 0.75%.
Earnings in Europe came from Audi, Veolia, Ocado and Deliveroo before the bell on Thursday.
In terms of individual share price movement, Deliveroo gained 6.5% after its results and outlook, while Italian biotech firm DiaSorin added 6.8% after better-than-expected full-year earnings.
At the bottom of the index, German conglomerate Thyssenkrupp fell 9.7% after its CEO said in an internal memo seen by Reuters that the war in Ukraine had forced the company to reassess its spending and potential spin-off of its steel division.
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— CNBC's Jesse Pound contributed to this market report.
