EUROPE MARKETS: Europe Stocks Edge Lower As Fed Looks Hesitant
August 22 2019 - 6:00AM
Dow Jones News
By Steve Goldstein, MarketWatch
European stocks drifted lower on Thursday, after indications
that the U.S. Federal Reserve last month wasn't aggressively
looking to cut interest rates in the world's largest economy.
Down 2.6% for August heading into the day, the Stoxx Europe 600
fell 0.29% to 374.70.
The German DAX declined 0.18% to 11781.75, the French CAC 40
declined 0.35% to 5416.34 and the U.K. FTSE 100 weakened 0.59% to
7161.15.
What's happening
Minutes from the Federal Open Market Committee's last meeting,
released after European stock markets had closed on Wednesday,
showed the central bankers
(http://www.marketwatch.com/story/fed-officials-shied-away-in-july-from-planning-future-interest-rate-cuts-2019-08-21)
generally favored an approach "that avoided any appearance of
following a preset course." Traders will now look to the key
Jackson Hole conference and the speech from Federal Reserve
Chairman Jerome Powell on Friday for interest-rate direction from
the world's largest economy.
"The market is well ahead of the economic data, with over 100
[basis points] of policy rate cuts priced in for the next year,
which raises the question of whether the Fed can change the future
outlook and re-steepen the yield curve with any new forward
guidance this week. With a short-term consumer-led recession
looking unlikely, the confidence factor hinges on the balance
between rapidly diminishing central bank stimuli and open-ended
global political headwinds," said Lena Komileva, chief economist of
G-Plus Economics, in a note to clients.
After a 240-point surge for the Dow Jones Industrial Average on
Wednesday, U.S. stock futures edged lower.
In Europe, IHS Markit reported that flash French manufacturing
PMI reached a 2-month high and that services PMI rose to a 9-month
high in August, while German manufacturing PMI inched up to a
2-month high, with services PMI falling to a 7-month low.
Read:European economy sees slight recovery from trade tensions
in August, PMI data shows
(http://www.marketwatch.com/story/european-economy-sees-slight-recovery-from-trade-tensions-in-august-pmi-data-shows-2019-08-22)
Focus stocks
NMC Health (NMC.LN) , a health services provider in the United
Arab Emirates, jumped 26% in London after Reuters reported it has
two competing bids to buy a 40% stake
(https://www.reuters.com/article/us-nmc-health-m-a-exclusive/exclusive-two-groups-one-backed-by-chinas-fosun-bid-for-nmc-health-stake-sources-idUSKCN1VB20R).
The company also said it's seeking approval for a $200 million
share buyback and reported an 18% rise in first-half profit.
Premier Oil (PMO.LN) rallied nearly 5% as the oil producer said
it will sell its stake in a Mexican project and reported record
output in the first half of the year. The company is looking to
expand its production in the Catcher Area of the North Sea.
Medical equipment maker Ambu (AMBU-B.KO) dropped 13% in
Copenhagen after issuing its second profit warning in two months.
The company said it was looking to have full control of its U.S.
sales force as it enters the ENT and urology markets.
(END) Dow Jones Newswires
August 22, 2019 05:45 ET (09:45 GMT)
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