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European stocks react to the meetings of the Fed, BOJ, BOE



European stocks opened lower on Thursday as investors around the world reacted to the last meeting of the US Federal Reserve.

The pan-European Stoxx 600 fell 1.2% at the beginning of trading, and core resources and technology stocks fell 2%, leading to losses as all sectors and major stock market deals slipped red.

European markets are following their counterparts in Asia and the United States lower as traders have heeded the Federal Reserve̵

7;s promise to keep it low for the next few years.

Members of the Federal Open Market Committee said the US overnight interest rate could remain at zero until 2023 as the central bank tries to boost inflation. In a statement, the commission said: “As inflation is constantly moving below this longer-term target, the Committee will aim to achieve inflation moderately above 2% over time, so that inflation averages 2% over time.”

Usually, the prospect of lower interest rates over a long period of time stimulates the purchase of shares. However, this was not the case on Wednesday. The S&P 500 and Nasdaq closed lower and the Dow finished well after their session.

In Asia, meanwhile, the Bank of Japan kept monetary policy stable on Thursday. In its monetary policy statement, BoJ said that the Japanese economy had begun to strengthen, but remained in a “difficult situation” due to the impact of the coronavirus pandemic at home and abroad.

In Europe, investors will follow political guidance from the Bank of England, which will also meet on Thursday. Today no changes in the bank’s monetary condition are expected.

In terms of revenue, retailers Next and John Lewis Partnership will publish interim results, and Kier will publish preliminary results for the full year.

– CNBC creators Justan Huang and Fred Imbert contributed to the reporting of this story.


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