European stocks are expected to open lower on Thursday as investors around the world react to a recent meeting of the US Federal Reserve.
According to IG, London’s FTSE opened 36 points lower at 6,043, Germany’s DX fell 112 points to 13,121, France’s CAC opened 40 points lower at 5,022 and Italy’s FTSE MIB opened 206 points lower at 19,745.
European markets Asia and the U.S. The lower will follow their counterparts as traders digest the pledge by the Federal Reserve to keep rates low over the next few years.
Members of the Federal Open Market Committee have indicated that the U.S. The overnight rate could remain anchored to zero-bound until 2023 as the central bank seeks to accelerate inflation. “As inflation continues to fall below this long-term target, the committee aims to achieve a modest 2% inflation for some time so that inflation averages 2% over time,” the committee said in a statement.
In general, the prospect of long-term low rates encourages buying in equities. That was not the case on Wednesday. Both the S&P 500 and the Nasdaq closed lower and the Dow ended well off its session high.
In Asia, meanwhile, the Bank of Japan kept monetary policy stable on Thursday. In a monetary policy statement, Boje said Japan’s economy has begun to recover, but has remained in “critical condition” due to the impact of the coronavirus epidemic at home and abroad.
In Europe, investors will pay close attention to any policy guidance from the Bank of England meeting on Thursday. The bank’s financial position is expected to change today.
On the earnings front, Retailers Next and the John Lewis Partnership will announce interim results and CARE will announce preliminary results for the full year.
– CNBC’s Justins Huang and Fred Ambert contributed to this story report.
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