April 21, 2016 / 1:37 PM / 2 years ago

European stocks fall after ECB keeps rates unchanged

(ADVISORY- Reuters plans to replace intra-day European and UK stock market reports with a Live Markets blog on Eikon - see cpurl://apps.cp./cms/?pageId=livemarkets for site in development. See the bottom of the report for more details) Adds details, updates prices)

* FTSEurofirst 300 down 1 percent after ECB decision

* Ericsson, Pernod top FTSEurofirst losers after results

* VW surges on signs of deal with U.S. authorities

* Banks continue to outperform

By Danilo Masoni and Sudip Kar-Gupta

MILAN/LONDON, April 21 (Reuters) - European shares fell on Thursday after the European Central Bank (ECB) kept rates unchanged, with Swedish telecom equipment maker Ericsson and French drinks firm Pernod leading the fall after disappointing updates.

ECB President Mario Draghi kept borrowing costs at rock bottom levels, sticking to his course of ultra-loose monetary policy, and said the bank would start its corporate bond purchases and a new round of cheap bank refinancing in June.

Anthilia Capital Partners fund manager Giuseppe Sersale said while it was too early to assess the impact of Draghi’s speech, details on credit measures were positive and there was some disappointment he did not mention the strength of the euro.

The pan-European FTSEurofirst 300 index was down 1 percent at 1315 GMT, extending losses after Draghi started to speak and after hitting three-month highs earlier in the week.

Shares in Ericsson slumped 12 percent after it posted first-quarter sales and operating profit lower than markets expected.

Pernod Ricard fell 7.4 percent after third-quarter sales came in below expectations as whisky sales in China continued to suffer.

Shares in Volkswagen rose 5.4 percent after sources told Reuters that VW and U.S. officials had reached a framework deal for the automaker to buy back almost 500,000 diesel cars containing software that enabled them to evade U.S. emission rules.

Europe’s bank sector index continued to outperform and was last up 1.3 percent.

Today’s European research round-up

ADVISORY- Reuters plans to replace intra-day European and UK stock market reports with a Live Markets blog on Eikon (see cpurl://apps.cp./cms/?pageId=livemarkets for site in development). In a real-time, multimedia format from 0600 London time through the 1630 closing bell, it will include the best of our market reporting, Stocks Buzz service, Eikon graphics, Reuters pictures, eye-catching research and market zeitgeist. Breaking news and dramatic market moves will continue to be alerted to all clients and we will continue to provide a short opening story and comprehensive closing reports.

If you have any thoughts, suggestions or feedback on this, please email mike.dolan@thomsonreuters.com.

Mike Dolan, Markets Editor EMEA. (Editing by Larry King)

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