European stocks fall below 7-week high due to European Central Bank decision and negative results

(Reuters) – European stocks fell from a seven-week high on Thursday after the European Central Bank declined to take major political action despite mounting evidence of damage to the eurozone crisis from the Corona virus.

Eurozone banks fell 5.5 percent as the central bank said it would pay banks more to borrow, but was in favor of not exhausting other policy instruments at its disposal.

The European Central Bank reaffirmed its massive bond-buying scheme, but disappointed some investors who expected the bank to raise its target and add high-risk bonds to its purchases in the coming months.

The banking sector was under pressure from the Societe Generale de France, which fell 8.6 percent, with a quarterly loss, while Lloyds Banking Group of Great Britain became the last bank negatively affected by the provisions to counter loans bad debt due to pandemic.

With energy shares declining and Royal Dutch Shell shares falling 10.8 percent as the company cut its cash dividends for the first time in 80 years, the British Financial Times 100 Index fell 3.5 percent. The index recorded the largest one-day loss in a month.

And the broader oil and gas sector index fell 3.4 percent.

The pan-European STOXX 600 index fell 2 percent after rising for three days, while the STOXX index of euro zone stocks fell 1.9 percent.

The Stoxx 600, however, posted the highest monthly gain since October 2015, as signs of easing in several major economies, strong stimulus measures and, more recently, and hopes of a cure for the Corona virus, helped recover. of a turmoil in stocks in February.

Shares of Britain’s Reckitt Benckiser rose 3.6 percent as the consumer products giant posted record sales growth in the first quarter and expected stronger-than-expected performance in 2020 as customers stock products. .

Semiconductor stocks were led by the Stoxx 600 index after the Dutch company expected a second-quarter revenue increase.